Billions lost in government's reluctance to insure
Feb 25, 2008
THE Government is losing billions of shillings because it does not insure its assets, insurance experts have said. An example is the sinking of the MV Kabalega ship on May 8, 2005, which was a total loss to the Government and the tax-payers because it had no insurance cover at the time it went down.
By Charles Bwogi
THE Government is losing billions of shillings because it does not insure its assets, insurance experts have said. An example is the sinking of the MV Kabalega ship on May 8, 2005, which was a total loss to the Government and the tax-payers because it had no insurance cover at the time it went down. Replacing it was then estimated to cost $15m (sh25b).
“The insurance industry has built enough capacity over the years to cover all the Government’s assets but the Government is still reluctant to insure them, ridding the insurance industry premiums in excess of sh70b,†Solomon Rubondo, the chairman of the Uganda Insurers Association, explained.
Rubondo said as a result of the reluctance to insure, the industry had remained dependant mainly on the private sector yet the Government is still the biggest employer, asset holder and key player in the economy.
While making a presentation under the theme: “Why is Insurance Different?†the chief executive officer of the Uganda Insurers Association, Dr. Olli-Pekka Ruuskanen, urged the Government to support the industry by enforcing insurance laws and developing more policies to promote insurance.
“One of the areas that has not been enforced is the Workman’s Compensation Policy, which by the laws of Uganda is mandatory for all employers to buy it for their employees,†he said.
THE Government is losing billions of shillings because it does not insure its assets, insurance experts have said. An example is the sinking of the MV Kabalega ship on May 8, 2005, which was a total loss to the Government and the tax-payers because it had no insurance cover at the time it went down. Replacing it was then estimated to cost $15m (sh25b).
“The insurance industry has built enough capacity over the years to cover all the Government’s assets but the Government is still reluctant to insure them, ridding the insurance industry premiums in excess of sh70b,†Solomon Rubondo, the chairman of the Uganda Insurers Association, explained.
Rubondo said as a result of the reluctance to insure, the industry had remained dependant mainly on the private sector yet the Government is still the biggest employer, asset holder and key player in the economy.
While making a presentation under the theme: “Why is Insurance Different?†the chief executive officer of the Uganda Insurers Association, Dr. Olli-Pekka Ruuskanen, urged the Government to support the industry by enforcing insurance laws and developing more policies to promote insurance.
“One of the areas that has not been enforced is the Workman’s Compensation Policy, which by the laws of Uganda is mandatory for all employers to buy it for their employees,†he said.