Increase of the threshold of minimum capital requirement
The Insurance Regulatory Authorities (IRA) have embarked on the review of the levels of the capital required to carry out insurance activities. This approach is designed to strengthen the protection of the policyholders.
So far, minimum capital requirements are fixed, established at 3 billion UGX (844 500 USD) for life insurers and at 10 billion UGX (2.8 million USD) for non life ones.
The new approach, currently under study, is based on the notion of venture capital. The amount of capital will depend not only on the minimum level but also on the additional percentage calculated on the basis of the assets detained.
This method has already been in use in the banking sector. Ugandan banks are required to detain a capital of 25 billion UGX (7 million USD) in addition to an amount corresponding to 12% of their assets.
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