Published: 02 October 2017

ZIMBABWE's biggest short-term insurer, NicozDiamond, says its gross premium written for eight months to August 2017 surged 6 percent to $30 million driven by business generated from new channels.

General manager corporate services, Ms Gloria Zvaravanhu, said the performance was satisfactory and in line with forecasts for the period, which if maintained could also see the group meeting its targets for the year.

"We are pleased with the performance we have achieved so far, against challenges in the market. We are happy with the growth we are registering compared to the top five in the industry," she said.

Ms Zvaravanhu said most of the growth came from new distribution channels that included bancassurance as well as investment income achieved courtesy of the sustained bull-run on the equities market.

"We had new channels, especially our bancassurance arrangement with MBCA, which grew significantly from last year."

The group is mostly invested in blue-chip equities.

NicozDiamond managing director Mrs Grace Muradzikwa said challenges included debtor management, especially in an environment where the time value of money is once again an issue yet clients still need terms.

She said this comes against the background where the market is experiencing an upsurge in claims costs due to the prevailing economic conditions.

Some of the costs include motor vehicle spares, which are tracking the economic dynamics.

Mrs Muradzikwa said they have responded by setting up a claims management department which will go beyond claims processing, but also verify the authenticity of claims to minimise fraud.

"An even bigger challenge is the issue of investments. For us as an (insurance) industry to say where do you put your money and which asset classes give you the best yields," said Mrs Muradzikwa.

However, Mrs Muradzikwa said the performance of the debtors was not very bad and the group continued to engage its customers to pay up, which has received positive response.

She said 80 percent of the clients were corporates.

"So you find that we really have to look at our portfolios, look at what's happening in the market and this is against the background of a regulator who is asking for compliance," said Mrs Muradzikwa.

Focus, she said, was on how the company can preserve value, while stretching revenues to ensure it covers growing costs.

NicozDiamond, like many other insurance firms, is exploring opportunities that will help them comply with new industry regulatory requirements.

However, Mrs Muradzikwa was quick to point out that as a listed entity, it had been ahead of current changes.

The insurer also needed to make decisions about whether or not to re-price its products and services given some changes taking place in the economy.

Meanwhile, NicozDiamond's operations in Malawi have been restructured, resulting in better performance this year, but much stronger performance is anticipated in the coming year.

Revenue rose to $7.2 million this year from $6.2 million last year.

Going forward, NicozDiamond plans to focus on sustained pressure on agents to deliver in order to keep growing the top line.

The group wants to leverage its premium local brand equity in a market where competition from foreign players is growing.

It will also seek to grow revenue streams through its nascent micro-insurance, which is said to have started well.

Expense management is expected to underpin profitability next year.
- online

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