KIGALI – The National Bank of Rwanda has said the absence of a minimum wage is killing the insurance sector in the country, The New Times has reported.
The daily reported that in the process of determining rightful compensation for workers when they are injured at work, courts rely on minimum wage to determine the indemnity to victims. Lack a minimum wage, among other factors, drives speculation, thereby negatively affecting the insurance sector.
Speaking to the Senatorial Standing Committee on Economic Development and Finance in Kigali last week, the Deputy Governor of the central bank, Ms. Monique Nsanzabaganwa, said the absence of common minimum pay was one of the issues threatening the survival of the industry.
The session was analysing the National Bank of Rwanda’s 2017/2018 financial year report.
“We need guaranteed minimum wage…its absence is killing the insurance sector,” Ms. Nsanzabaganwa said, pointing out that currently, courts base on a daily wage of Rwf3,000 to make decisions, which could be misleading.
She concurred with insurers that some people are exploiting this gap, making an urgent call to set the basic wage.
Jean Pierre Majoro, the executive secretary of Rwanda Insurers’ Association, told The New Times that the fee was Rwf5,00 back in 2012 before gradually increasing to Rwf3,000 currently, pointing out that this is detrimental to the insurance sector performance.
He said that the minimum salary is needed in order to prevent speculation by judges or lawyers.
“The move would be beneficial for both the claimant and the insurer because there have been delays resulting from disagreements that end up in court over the money that should be given to the former,” Mr. Majoro noted.