Softening insurance market sink FBC Holdings Insurance business in H1 2017
Insurance24 reporter
HARARE, FBC Insurance units recorded a 10% decline in premium revenues and a 16% decrease in net earned insurance premium during the six months period ended 30 June 2016 largely due to low economic activity and the shift in demand for some traditional insurance products.
Chief executive officer John Mushayavanhu presenting the Group interim results yesterday said the insurance market continues to soften and as evidenced by the first quarter IPEC report there wasn’t growth across the sector.
“What we have noticed generally is that the insurance market is softening, if you look in the Q1 report, there wasn’t growth in the sector, thus the Group will expand more into micro-insurance supported by other various new products and synergies,” he said.
According to Mushayavanhu, FBC Insurance, formerly Eagle Insurance introduced additional activities during the period and now has a Life licence and is underwriting Life business.
“We took that licence mostly to do what we call short debted life assurance, We are talking of things like mortgage insurance where if someone takes a mortgage, he then takes up a life policy but we are not as yet going into fully fledged Life assurance, but just short term life products,” he said.
FBC Insurance has also gone into medical insurance in partnership with Liberty Insurance which is a South African managed product which is now under the control of FBC Insurance.
“We are managing that business and those that have used Liberty for medical purposes know that it is now the most accepted medical aid card in Zimbabwe and we want to continue in that way to improve the business and is going to contribute significantly to Gross Written Premium (GWP) and net earned profits,” he said.
On FBC Reinsurance, he said the Life business which started last year have shown signs of growth and will be continuously natured to achieve more growth.
Meanwhile, during the period Insurance premium was at $9.6 mln lower than 11.2 mln same period in 2016. Premium ceded to reinsures was flat on $6.7 mln.
Group total income for the period was $45 mln and FBC Re and FBC Insurance contribution was 15% and 9% respectively.
The company’s gross written premium for the period was at $9.62 mln, a 6.5% market share of the total industry’s premiums of $68.22 mln as at March 2017. FBC Reinsurance gross premium written was $7.9 mln.
