Rwanda Social Security Board (RSSB) is in the final stages of acquiring Sonarwa Insurance Ltd, one of Rwanda’s oldest and largest insurers.
The insurer has multiple shareholders, including the Rwanda Social Security Board (RSSB) and Industrial and General Insurance SA, a Nigerian insurance firm.
The Nigerian firm acquired 35 per cent stake in the insurance company in 2008.
The firm has had multiple management issues in the recent past, especially while in the hands of Nigerian managers, sources said.
The firm has also come under fire for several unethical issues such as delayed payments for customer claims.
The takeover is also largely viewed as an opportunity for the firm to regain a positive reputation and restore its glory days.
The Deputy Director-General in charge of fund management at RSSB, John Bosco Sebabi, confirmed to The New Times that the deal was in the process.
Without revealing much detail, Sebabi said that discussions and negotiations were ongoing between them and the insurer.
It’s still unclear when the deal will be complete but sources say that it could be sealed any time.
The stake in Sonarwa is part of the pension body’s investment portfolios in local companies, which were last year valued at 25.9 per cent of its total assets.
RSSB has investments largely in real estate and owns several commercial buildings that are rented to district administrations, businesses and residential apartments.
Sonarwa is one of the oldest insurance companies in the country and was established in August 1975, initially operating under the management of a UK-based company, JH Minet.
At the moment, insurance penetration in Rwanda is at about 2 per cent, which is below the Africa average of about 2.8 per cent.
Industry experts say if the sector will change the trend in coming years, players have to develop multiple products that meet customers’ demands.
A section of the insurance industry players have been accused of having unethical conduct and illegal tendencies which threaten to tear apart the local insurance sector.
Among the practices are firms selling insurance premiums on credit while others are undercutting their prices to win customers.