Published On  Jan 15,  2012




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Vehicle owners who were expecting another extension of the registration deadline for compulsory third-party insurance were disappointed this past week. Traffic police officers across the town were on the troop, looking for those who did not display the necessary windshield sticker or carry a certificate as evidence for insurance coverage, reports Elleni Araya, Fortune Staff Writer.

Drivers Lacking Third-party Insurance Sticker Run Gauntlet in First Week of Enforcement


Taye Abebe, sergeant, was patrolling the intersection between Burundi and Tesema Aba Kemaw streets, around the area locally known as Goma Kuteba, on Friday morning, January 13, 2012, when Tsige Benti, 70, a businessman accompanied by two gentlemen, drove his Toyota pickup truck past him.

Tsige was stopped by the officer, for he was found driving a vehicle without an insurance certificate on the windshield. He was promptly dispossessed of his driver’s license and issued a blue ticket authorised by the Insurance Fund Office, a federal agency established in 2010, which states that he has five days to get coverage for the insurance and get back his license.

“But, I do have coverage with Awash Insurance,” the elderly man countered. “I just left it at home.”

The pickup truck had been in the garage since July, due to complications with the engine. It is now on its way to get its electrical system fixed, at another garage, Tsige explained to the officer.

“I did not put the sticker on my windshield just in case water gets in the car and damages it,” he pleaded.

The story was not palatable for Taye, who would not relent.

“If you do have insurance, you can bring it to the district office and get your license back,” he told Tsige.

Disappointed, Tsige asked where the Lideta District Police Department was, and continued on, leaving behind his driving license in the hands of the officer.

“The gentleman seems to be genuine, but me and my colleagues have heard the ‘I have left my paper at home excuse’ repeatedly since Tuesday,” Taye told Fortune. “We need to be careful not to be too lenient.”

Last Tuesday, January 10, 2012, marked the first day of the supervision of compulsory third-party insurance coverage, enforced by federal and city authorities. Although the 2008 proclamation, which makes insurance coverage against third-party risks mandatory, was to take effect immediately, it was only after the Insurance Fund Office was established and the registration period was set for the last three months of 2011 that the ball started rolling.

The proclamation, ratified due to the escalating number of accidents in the country, requires vehicle owners liability coverage against third-party risks of up to 40,000 Br, in case of death; up to 15,000 Br, in case of bodily injury; 1,000 Br for emergency medical treatment; and 100,000 Br for property damage to be paid to victims of accidents on the road.

But, sticking to the original deadline proved to be a tough. After extending the deadline by a month, for a significant number of the 380,000 vehicles across the nation had not been registered, the Office finally gave the mandate to the city’s traffic police department to start taking away driving licenses from drivers in vehicles that have not yet registered for third-party insurance.

Taye has ticketed nine vehicles in the four days starting Tuesday.

“I have let new vehicles with temporary driving licenses pass with a warning because they may have just bought the car,” he told Fortune.

It has been a much tuned down approach that authorities have decided to take, convinced that they would rather lean on educating the public before employing the full force of the law. The penalty that the Office imposed last week was much less than what was expected. However disappointed people may get when their licenses are taken away, the punishment is a mere slap on the wrist compared to what the 2008 proclamation allows of law enforcement agencies.

Those found in violation of the provisions of the proclamation or subsequent regulations can be subjected to penalties, including imprisonment of one to two years.

People need to get used to the system before moving on to more stringent regulations, said Bayleyegn Bekele, public relations head at the Office, who reminds that third-party insurance is meant to benefit and not harm citizens.

“At first, people will have their licenses taken away and will be given a five-day period,” he told Fortune. “Then we will follow the measure that penalises people in fines, but it will be counted as an infraction in the traffic code instead of a violation of the proclamation.”

The maximum fine for violating a traffic code is 700 Br, still much less than what is asked for in the proclamation - 3,000 Br to 5,000 Br.

So far, fear of being subjected to penalties of up to 5,000 Br is what seems to be driving most vehicle owners to rush and get the insurance before time runs out in January. During the initial three-month registration period, beginning September 11, some vehicle owners had complained that the premium set for their automobile was too high.

Leaders of the Taxi Owners’ Association were especially vocal, sending letters in November 2011 to Kuma Demekssa, mayor, claiming that because their profit is determined by the government and most of their vehicles are old, they cannot pay the premiums in a lump sum. They had copied their letter to authorities at the city transport authority and the Insurance Fund Office.

Fearing the fines, taxi owners have finally paid for the premiums, their request to pay in instalments denied by the Insurance Fund Office. They were also told that the deadline would not budge.

Isuzu trucks drivers had also complained that they were being charged the same premiums as trucks twice their size. After being told that amendments to the premium tariff will only be revised after a year, they also complied.

It was this persistence from officials of the Insurance Fund Office, in maintaining that the deadline would not be extended, that led to such concessions. Those that took the risk and did not register, however, got away with it, when the deadline was extended for a month, in December 2011. Now it is through grace periods and lowered fines that the Office is trying to lure in those who are left.


The street of Sierra Leon (Debre Zeit Road) was swarmed by casual passer bys to watch the horrible accident caused by two mid-buses.


The lenience, however, seems to be lost on drivers, who were stopped for not being covered this past week.

Nigat Gebrekidan, deputy sergeant, sat in a small room at Kirkos District Police Department, also known as Sidestegna. Her desk was littered with driving licenses which drivers came to reclaim through the bars of her office window.

Vehicle owners, who were there on Friday afternoon for not registering for third-party insurance, complained that they were treated unfairly.

“I was not in this country and did not know about the registration deadline,” a driver claimed.

Other’s said they did not have enough money or were driving a friend’s car.

Nigat did not hear the stories but checked if they had registered for the insurance before handing their driving licenses back. Around 57 drivers had their licenses taken away, Tuesday to Friday, in Nigat’s District alone. Of these, 32 came to reclaim their licenses after registration. 

It is hard to get concrete numbers from the Insurance Fund Office on how many people have registered to date. Inconsistencies are encountered during data collection from the 13 insurance companies that provide motor insurance, with their numerous branches, according to Alemu Ejigu, operations manager at the Office.

The Federal Transport Authority keeps track of the number of vehicles found in the country. However, they estimate that around 285,000 of 380,000 vehicles on the road across the country were registered by the extended deadline, according to Bayleyegn.

“The numbers keep changing as new cars get into the country,” Bayleyegn said.

Neither were officials at the Office sure about the amount of money raised for the Fund, after the sale of premiums by insurance companies started in September. Around 10pc of all insurance premiums paid are to be transferred to the Office to be deposited in its account with National Bank of Ethiopia (NBE).

“We expect around 28 million Br,” Bayleyegn told Fortune.

However, if the Fund Office manages to get all vehicles in the country registered, the amount it will get will be much more than that. The minimum premium tariff set by the Insurance Fund Office for automobiles of private use that have motor power less than 1,600cc is 505 Br.

The money collected from vehicle owners is meant, under the law, to be used to help victims of unidentified vehicles and emergency treatment of victims at hospitals.

Vehicle owners, however, will have to get another windshield sticker to be able to drive on the roads of the country, as the newly-automated yearly vehicle inspection will start in just a couple of weeks.




By Elleni Araya,
Fortune Staff Writer



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