To: All Qualified Bidders

Dear Sir / Madam,

INVITATION TO BID

Provision of Consultancy Services for the Development of an Investment Strategy

PRIME Insurance Ltd invites all qualified bidders to submit their bids for the provision of investment strategy services. Participation is open to all qualified bidders who fulfil the requirements as per the terms of reference.

Responding bidders are advised that this solicitation does not in any way obligate Prime Insurance Ltd to make a contract award or compensate responding firms for any costs associated with the preparation and submission of their proposals.

ADMINISTRATIVE SPECIFICATIONS

For submission of the bid, all bidders must comply with the following administrative requirements:

• Bid submission form duly signed by the Managing Director as designated on the Trade Certificate Licence. (If the Managing Director has changed, Board minutes and a power of attorney confirming the new Managing Director's name must be included.) The form must be well printed and properly organised.
• Bid security from a bank or insurance company (other than Prime Insurance Ltd) equivalent to one million Rwanda francs (RWF 1,000,000).
• Copy of Trading Licence in the name of the bidding company, issued by the Rwanda Development Board (RDB).
• Demonstrable experience of at least five (5) years in the relevant domain.
• Original or certified copy of the Rwanda Social Security Board (RSSB) Certificate in the name of the bidding company.
• Copy of the tax clearance certificate or a statement of arrears from the Rwanda Revenue Authority (RRA) in the name of the bidding company.
• Payment of a non-refundable fee of RWF 50,000 to the Prime Insurance Ltd account held at Equity Bank: Account No. 4003200206408.

DEVELOPMENT OF AN INVESTMENT STRATEGY — TERMS OF REFERENCE

1. Executive Summary

Prime Insurance Ltd seeks to engage a qualified expert to develop a comprehensive Investment Strategy and Investment Policy Framework fully aligned with Regulation No. 88/2024 of 19/12/2024 issued by the National Bank of Rwanda (BNR), as well as the requirements of the evolving Risk-Based Capital (RBC) framework. The assignment will ensure that the Company's investment governance, asset allocation, risk management, and performance monitoring practices comply with regulatory expectations while supporting its strategic and financial objectives.

The increasing complexity of the regulatory landscape, combined with the need to optimise risk-adjusted returns while safeguarding policyholders' interests amid a rapidly evolving geopolitical and global trade environment, necessitates the establishment of a robust, structured, and forward-looking investment framework. This framework will support prudent investment decision-making, enhance risk management practices, ensure regulatory compliance, and contribute to the long-term financial sustainability of the Company.

The proposed assignment will result in a robust Investment Strategy that ensures:

• Compliance with BNR regulations and admissible asset requirements
• Alignment with the Company's liability profile
• Optimisation of capital under the RBC framework
• Strengthened governance and risk management

2. Background and Context

The Rwandan insurance sector is undergoing significant regulatory transformation following the enactment of Law N° 030/2021 governing insurance business and subsequent regulations issued by BNR. Key developments include:

• Introduction of a Risk-Based Capital (RBC) framework (effective 2025) , regulation NO 88/2024 OF 19/12/2024 governing risk based capital requirements for insurers
• Enhanced corporate governance and risk management requirements
• Strengthened oversight on investment practices and admissible assets

These reforms require insurers to adopt more disciplined and risk-sensitive investment approaches that explicitly link asset allocation decisions to liabilities, capital requirements, and liquidity needs.

While the Company maintains an investment portfolio, there is a need to review and strengthen the following:

• Strategic asset allocation
• Risk appetite and limits
• Asset-liability matching practices
• Investment governance and reporting structures

3. Problem Statement

The Company faces the following challenges:

• Increasing regulatory scrutiny under the RBC framework
• Potential inefficiencies in capital allocation across asset classes
• Exposure to concentration and liquidity risks
• Vulnerability to inflation and currency depreciation arising from concentration in Rwanda franc–denominated term deposits and government securities
• Limited integration between actuarial liabilities and investment decisions

Without a structured investment strategy, the Company risks:

• Sub-optimal returns
• Increased solvency pressure
• Regulatory non-compliance
• Weak governance over investment decisions
• Erosion of real investment value over time

4. Objectives of the Assignment

The primary objective is to develop a Board-approved Investment Strategy and Policy Framework that will achieve the following:

Capital Preservation: Ensuring that the real value of assets is maintained over time — i.e., safeguarding against losses, inflation, and currency depreciation.

Return Generation: Achieving sufficient returns to meet financial goals, including profitability, liability matching, and shareholder expectations.

Liquidity: Maintaining sufficient readily available funds to meet obligations as they fall due.

Regulatory Compliance: Ensuring full compliance with BNR regulations.

Capital Efficiency: Improving capital efficiency under the RBC regime.

Governance: Strengthening governance, controls, and reporting structures.

5. Scope of Work

The assignment will cover the following key areas:

5.1 Regulatory Review

• Detailed review of BNR investment regulations and admissible asset requirements
• Identification of investment limits, restrictions, and approval requirements
• Assessment of RBC capital charges across asset classes

5.2 Portfolio Diagnostic

• Analysis of current asset allocation and performance
• Assessment of concentration, credit, and liquidity risks
• Benchmarking against market returns and regulatory expectations

5.3 Asset-Liability Matching (ALM)

• Analysis of claims patterns and liability structure
• Duration matching and liquidity assessment
• Alignment of investment horizon with liability profile

5.4 Market Assessment

• Evaluation of available investment opportunities in Rwanda and the region
• Analysis of fixed income markets, equities, real estate, and alternative assets
• Assessment of macroeconomic factors (interest rates, inflation, foreign exchange)

5.5 Strategy Formulation

• Development of Strategic Asset Allocation (SAA)
• Definition of asset class limits and ranges
• Liquidity management framework
• Diversification strategy

5.6 Risk Management Framework

• Definition of risk appetite and tolerance
• Establishment of limits for market, credit, and concentration risks
• Stress testing and scenario analysis framework

5.7 Governance Framework

• Development of Investment Policy Statement (IPS)
• Clarification of roles and responsibilities (Board, Committees, Management)
• Reporting and monitoring framework
• Internal controls and compliance processes

5.8 Implementation Roadmap

• Phased implementation plan

• Identification of required tools and systems

• Capacity building recommendations

6. Required Qualifications

The consultant/firm should demonstrate:

• At least 10 years of experience in investment management, asset allocation, or investment advisory. 
• Proven experience in developing investment strategies and policies for insurance companies, pension funds, banks, or financial institutions. 
• Strong knowledge of Risk-Based Capital frameworks. 
• Familiarity with insurance regulatory requirements. 
• Professional certifications such as CFA, FRM, CAIA, Actuarial qualifications, or equivalent. 
• Experience in emerging and frontier markets is desirable.

7. Expected Deliverables

The assignment will produce the following deliverables:

• Inception Report
• Diagnostic and Regulatory Assessment Report
• Draft Investment Strategy and Investment Policy Statement (IPS)
• Final Investment Strategy Document
• Board Presentation and Approval Pack

8. Duration of Assignment

The assignment is expected to be completed within 8–10 weeks from signing.

Col. (Rtd) Eugene HAGUMA M.

Chief Executive Officer

PRIME Insurance Ltd