Fidelity Life total cumulative income below budget in five months, eyes recovery in H2
HARARE, Fidelity Life Assurance of Zimbabwe says despite missing budgeted income during the first five months of the year, the company remains profitable and sees recovery during the second half on anticipated increased insurance uptake in 2017.
The company held its 38th annual general meeting this afternoon where all resolutions which included approval of Directors fees amounting to $171 762 were approved.
Group chairman Fungai Ruwende told shareholders that projected 2.8% GDP growth for the economy in 2017 bods well with the company’s operations.
“2016 was characterised by slow uptake of insurance products, but 2017 has better fortunes driven by a good agricultural season and increasing capacity by local manufacturing companies supported by SI 64 of 2916,” he said.
He said despite the company’s debt still remaining significant, the company will forge ahead with the Langford housing project where it intends to construct more than 11 000 houses.
Meanwhile, in a trading update for the period, acting managing director Nyaradzo Matindike said Group total cumulative income amounted to $8.4 mln against a budget of $12.3mln.
“We however expect significant improvement in the second half of the year as a result of products that are being launched starting the month of July and also as a result of new schemes coming on board on the insurance business,” she said.
The group’s funeral business Fidelity Funeral registered 36% increase on income at $158 000 compared to $116 000 in 2016 same period comparable.
The group registered a slight increase in claims increasing 3% to $2mln compared to a claims ratio of 1.98% in 2016. However, due to cost containment measures during the period, operating and administration expenses went down by 5%.
Fidelity, which is also a diversified financial services group saw micro-lending net interest income near flat at $1mln, a performance 1% above prior year’s $900 000.
Matindike said the asset management company is on the drive to increase funds under management and it also plays a pivotal role in offering advisory services to the group.
The Malawi outfit income to date grew by 60% to $1.6mln from $1mln driven by the acquisition of mainly annuity schemes during the period.
The acting MD said the company is on a drive to increase distribution services hence establishing one stop shops outside Harare, which is in Gweru and Masvingo.
