20100120
allafrica

Public Service Vehicle underwriting has been the graveyard of many an insurer.

Indeed, companies that insure the chaotic industry usually find themselves in a precarious position and it is little wonder the Insurance Regulatory Authority has instructed firms to separate general from life insurance business.

The general business dominated by matatu insurance invariably bleeds, and may result in life insurance compensating for the loss.
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Except for a brief period in which the Michuki Rules were implemented, this situation has remained constant over the years.

That is why firms like Invesco Assurance Company collapsed. Fortunately for the firm, the Matatu Owners Association has injected Sh200 million into the business to snatch it from certain death.

There is irony in what is probably more than a business adventure. The operators have bankrupted many an underwriter. They now face the same fate if they do not style up and comply with road safety rules.

It remains to be seen whether holding this stake will change the conduct of matatu owners and operators. But suffice it to say that the government now has to seek the industry's co-operation in enhancing standards for the public good.

While wishing PSV operators success in this venture, we also urge the government to play its part in ending the complicity of police officers in this chaos.