Funds to compensate victims of non-insured accidents in Rwanda will now be drawn from 10 per cent of insurance premiums, collected from compulsory third-party motor vehicle liability cover, according to the new accident victim compensation bill, passed by Parliament on Wednesday, September 17.

The bill also determines that five per cent of the gross annual income generated by the national tourism body from activities in protected areas. Compensation will be determined based on the severity of the damage caused by the accident and the victim’s income.

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If the victim or their beneficiaries cannot provide evidence of the victim’s actual income before the accident, compensation will be based on the tax-free income threshold (Rwf60,000 per month or Rwf2,000 per day).

Currently, accident compensation is guided by two separate laws: the 2001 law on compensating victims of physical accidents caused by motor vehicles and the 2011 law on compensation for damages caused by animals.

The Supreme Court’s 2016 benchmark of Rwf3,000 per day is currently used as the minimum compensation in such cases, although the insurers have raised concerns that the amount is high.

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The bill further clarifies that a person who suffers permanent incapacity, as determined by a competent medical doctor, is entitled to compensation for financial loss or future earnings, pretium doloris, aesthetic injury, loss of a marriage opportunity, and loss of career prospects.

Yet the beneficiaries of a person killed in an accident are entitled to compensation for funeral expenses, compensation for financial loss or future earnings and compensation for moral wrongs. The compensation granted to a person who suffers material damage is in proportion to the damage suffered.

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"For children under 16, compensation for loss of future earnings is paid to the child who has suffered a permanent disability or their dependents in the event of death. This compensation covers the potential years of employment between the age of 16 years and retirement,” the law highlights.

The law also provides that if the victim or his beneficiaries cannot provide any evidence of real income earned by the victim before the accident, compensation is allocated depending on the monthly employment income subject to tax on employment income at the tax rate of 0%, instead of the minimum wage, which is subject to controversy in Article 12 of the law.

MP Hope Tumukunde Gasatura noted that the law also aims to address the issue of accident victims frequently submitting inflated or exaggerated invoices.

"The law provides that refund of other expenses incurred by the person who suffered corporal damage is made upon presentation of electronic invoices issued by an electronic invoicing system recognized by the legislation on tax procedures,” she said.

However, Article 4 states that payments not supported by an invoice generated through an electronic invoicing system approved by tax regulations are adjusted, by mutual agreement, based on prevailing market prices.

MP Eliane Mukarusagara raised concerns about determining compensation for accident-related expenses.

"Won’t there be challenges in establishing what expenses are eligible? Some people use private hospitals or private transport, and not all costs come with official receipts. For instance, if someone chooses higher-quality services, these may not be reimbursed by a third party. Could this approach cause issues instead of setting a clear baseline for compensation?”

Tumukunde noted that everyone is allowed to use any hospital approved by the government.

MP Erneste Nsangabandi asked whether the law addresses situations involving high-risk drivers, such as those who drink and drive, and whether victims in such cases would still be compensated.

Umukunde said a new law is being drafted to specify penalties for such drivers. However, until that law is enacted, the vehicle owner (not necessarily the driver) remains responsible for compensation to such victims.

Those entitled to compensation include individuals injured or whose property is damaged in insured or non-insured accidents, persons injured by animals inside national parks or other protected areas, while working or visiting with official authorisation; persons injured or killed by wild animals outside national parks, as listed by the Minister in charge of Environment; and beneficiaries of individuals killed in such situations.