Reference is made to the recent news articles that appeared in The Rwanda Focus newspaper and media in general as well as the press release by BNR. It is indeed true that we have already informed the regulator BNR that we shall exit the Rwanda Insurance market when the last of our clients expire in 2012.
We regret to announce that with effect from 1st February 2011 the AAR Board took a decision to divest out of the Rwanda insurance market.
We are therefore not renewing any clients that fall due, nor are we accepting any new clients. We have made arrangements with to ensure that services to our clients continue to be provided until their policies with us expire.
We submitted an exit plan to National Bank of Rwanda (the insurance regulator) in February 2011 and are in constant touch with them as we do everything to ensure that our exit from the market is as smooth as possible. In the meantime we have downscaled our office as we wind down our operations.
AAR commenced operations in Rwanda in May 2005. We have since then provided exemplary health services both locally, regionally and internationally to our members as well as creating employment to Rwandan citizens. AAR has also played its role effectively as a corporate citizen in Rwanda.
In October 2009 the regulator informed us of revised capital requirements for insurance companies which raised the level of Capital and Solvency requirements from Rwf 100 million to Rwf 1 and 0.5 billion respectively for short term business under which we fall.
We explored all our options and unfortunately it became clear our business was no longer viable. This was because unlike other insurance companies in the Rwanda market who write other classes of insurance risk, AAR only underwrites medical insurance which is just a component of the entire industry premiums.
This reduces the scope for growth of our business to justify this increased level of capital.
Once again we wish to emphasise that service provision to existing policy holders will be uninterrupted as per contract obligation till expiry of all contracts in February 2012.
We are very grateful to the Rwanda Government and BNR, our clients, staff, providers and all business partners for the support that they have given us for the period that we have been operating in Rwanda. It is our sincere hope that at some future date we shall be able to provide services in Rwanda again.
Group Chief Executive Officer
AAR Holdings Limited
9th May 2011
Directors: Dr. F.G. Njenga (Chaiman). J. Gakunju (CEO), Mrs. M.G Beckmann (Kenyan),
D.J. Oatway (British), W.v. Staden (South African), L. Bertolli (Italian), Njeri Rionge