THE country’s life assurance companies have reported a 17 percent growth in net premiums to $218 million for the third quarter ending September compared to the same period last year with the top three players consolidating their market share.
According to the Insurance and Pension Commission report for the period, expenditure grew by 18 percent from $141 million to conclude the current reporting period at $167million resulting in a $52 million profit.
The insurance regulator expressed concern over the sector’s compliance levels on prescribed assets despite registering growth in assets.
Total assets grew by 12 percent from $1,46 billion last year to $1,67 billion in the current reporting period.
Old Mutual registered a 13 percent growth in net written premium to $107 million as the insurance industry targeted the thriving informal sector. Nyaradzo and First Mutual Life (FML) also reported a growth in business.
“The major challenges affecting the industry were minimal compliancy with prescribed assets ratio, capitalisation among others. The Commission will continue to work with the industry in order to ensure compliancy,” reads the report in part.
“Although there is a slight improvement, the prescribed asset appetite continued to be low at two percent or $33 million (September 2013: one percent or $15 million).The Commission requires increased uptake given improved availability of approved paper.”
For the period under review, the three biggest players—Old Mutual, Nyaradzo and FML controlled $177 million or 84 percent of net premium written (September 2013: $150 million or 81 percent).
Employee benefits business according to the report contributed $150 million or 69 percent (September 2013:$132 million or 71 percent) in gross premium while $66 million or 31 percent was attributed to individual life assurance (September 2013:$54million or 29 percent).
“The slight growth in individual lines of business may be due to the industry now focusing on the informal sector via micro insurance in line with prevailing economic realities and our current thrust as the Commission,” read the report.
The three major classes of business were from fund business ($113 million or 53 percent), funeral (29 percent or $62 million) and GLA ($23 million or 11 percent).Advertisement
Total claims grew by 21 percent annually against premium growth of 17 percent. However in gross terms, the major claim categories were surrenders ($35 million or 32 percent), maturity ($33 million or 30 percent) and death ($28 million or 25 percent).
The asset portfolio for the industry was in: properties at $543 million; equities, $592 million or 36 percent; money market at $233 million; cash assets, $21 million and other assets at $206 million.