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PSV Car Insurance In Kenya

Posted on 2017-05-22
PSV Car Insurance In Kenya

A PSV is a Public Service Vehicle offering a mode of transport from point A to B. PSV vehicles are the most common mode of transport providing up to 70% of all mode of transport in Kenya in major towns and upcountry. Most of these vehicles operate within towns and cities with the rest operating routes from one town to another/others and a small majority operating across borders e.g. to Uganda, Tanzania, etc. All motor vehicles in Kenya including PSVs require car insurance in Kenya to operate on the road.

Types of PSV Vehicles

These vehicles that fall under this category of PSVs include:

Matatus & Buses

This the most popular type of PSVs on the roads in Kenya. They come in 3 main modes, the 14 seater minivan, more popular are the minibus and bus ranges sitting anywere from 29 to 47 passengers.

Tour Vans

These are used to carry visitors and tourists on safaris in and out of the city, they mainly comprise of Land Cruiser 4x4 and mini vans.

Chauffer Driven vehicles

These are vehicles driven by a specific driver and assigned an organized PSV group provider such as hotels, Uber, Little Cab, Modi, Pewin just to mention a few. This class is considered less risky as it is assigned to a specific driver

Car hire vehicles

These are vehicles that are hired by any individual to carry out their businesses and/or trip. This class is risky in the as the vehicle can be driven by any person and sometimes, the vehicles can used to other activities not covered by the insurer.

Yellow Line Taxis

These operate on defined routes, popular are the airport taxis that shuttle people from the main international airports.

Boda Boda

Though not classified as a motor vehicle, another category that is classified in this category is the PSV motor cycle, commonly referred to as “Boda Boda”. Popular in Kenya and the East African region for the price and convenience simply because it gets around much faster than motor vehicles especially during peak hours with heavy traffic on the roads.

In Kenya, like any other class of motor insurance, PSVs need to be insured before being given the license to operate as one. There are three times of PSV insurance covers currently available namely:

  1. Third Party Only
  2. Third Party, Fire and Theft
  3. Comprehensive Insurance.

Third Party Only

This is the basic coverage for any PSV vehicle to be on the road. This covers any third party liability cases that might arise from the usage of the vehicle. This is most basis and most common class of insurance in this class of vehicles in Kenya.

  • Third party liability in respect to persons
  • Any person not being carried in or entering or getting onto or alighting from the vehicle. This is the pedestrian on the road whom may get injured as a result of careless driving or any other cause.
    A passenger in the vehicle who exchanged money for the service. This person is covered a specific clause in insurance called, Passenger Legal Liability. This is meant to ease financial burden of the insured as it is a legal requirement.

  • Third party liability in respect to Property
  • This clause covers any claims that arise as a result of the insured vehicle damages property belonging to a third party. This includes but not limited to other vehicles on the road, knocking down a fence/gate belonging to a third party, even an animal belonging to someone else.

  • Third Party, Fire and Theft
  • This is a rare class of insurance for the PSV vehicles. This class covers the following areas:

    1. The third party liabilities as discussed above.
    2. Fires that damage the vehicle. However, not all causes of fires are covered. The fires covered are the once that come as a result of the following causes:

    Arson: these are fires set on your vehicle maliciously. This is referred to as vandalism.

    Garage/Parking lot fires: these fires can start either at where the vehicle is parked or even at home.

    Engine fires: under extreme circumstances, the engine of the vehicle might have sudden combustion and your whole engine is covered by fire as a result of mechanical issue. Though insurance does not cover for mechanical failures, an engine fire is different as it may result to a total loss of the vehicle.

    Car accident: sometimes as a result of a very severe accident, a fire might start. If you are involved in a collision and a fire starts, a claim adjuster will be involved and will determine if the vehicle will be compensated under fire or a comprehensive insurance package.

Comprehensive Insurance cover

PSV vehicles also require car insurance quotes to operate in Kenya, especially driven by strict requirements from many of the new ride hailing applications like UBER , LITTLE, etc. Based on the category of PSV that the vehicles lies on whether a matatu or any other class such as car hire, Chauffer Driven (Uber, Pewin, Little cab etc.), they all qualify for comprehensive insurance.

Comprehensive insurance encompasses the following areas of coverage:

  • Third party and passenger legal liability,
  • Third party, fire and theft and passenger legal liability
  • Material damage to the car as a result of accidents, collisions, vandalism to specific parts of vehicles such as side mirrors and head/and back lights, radio cassettes and as well as damage to windscreen among others.
  • In the case of matatus, there comprehensive insurance is quite different compared to all other classes of PSV vehicles. While other vehicles haves have the comprehensive covering all the three mentioned areas in one package, for matatus is different.

    Matatu Motor Vehicle Insurance

    For matatus, the material damage, fire and theft is covered by what is called, Motor Asset. The matatus hence have to take a separate third party cover which is priced differently from all the other insurance covers for motor vehicles. The pricing of the third party is usually based especially on the seating capacity of the vehicle, the more the seating capacity; the higher is the premium for third party coverage this also caters for the passenger legal liability aspect. Therefore, for a matatu to be comprehensively covered, it will need to have,

  • Third party which covers both the passengers and the third party liability and
  • Motor asset
  • There are currently only two matatu insurance providers/underwriters in the market that is Invesco and Directline. Previously, AMACO insurance offered PSV car insurance for matatus but pulled out of the segment due to heavy losses in the business. The providers of this class in Kenya is quite limited as a result of fraud and huge settlement claims which can set the insurance company into bankruptcy of in to deep financial problems.

    The rating of all these PSV Vehicles in Kenya is quite different based on the risk rating assigned to each vehicle based on the claim experiences.

    Example car insurance rates;

  • The PSV chauffer driven and tour vans is the cheapest in terms of car insurance premium rates, these start from as little as 5.2% to get the comprehensive insurance for that vehicle inclusive of excess protector for own damage claims and the political violence and terrorism cover. In addition to that, the Passenger Legal Liability is required; it is charged per passenger that the vehicle is designed to carry. The Yellow Line cabs like airport cabs enjoy similar car insurance rates as the PSV chauffeur driven.
  • The car hire segment follows next being more expensive due to the higher perceived and actual risk of the business. Comprehensive motor vehicle insurance cover starts from 10% of the value of the vehicle plus passenger legal liability
  • Finally, the matatus being the most expensive with the rating based on the third party insurance which is calculated on the seating capacity of the vehicle plus the motor asset insurance with minimum of 6% value of vehicle based on the insurance company
  • Are you looking for a Quote

    If you are looking for a quote for PSV chauffeur driven vehicle for online apps like UBER, taxify, LITTLE and more, get in touch with us to see how much you could save. We also offer insurance for Matatus, self drive vehicles and buses, speak to our insurance experts or start an online chat right now. Check out what other customers are saying about our PSV motor insurance covers on our CUSTOMER REVIEWS page.

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