Willis Faber Dumas and Rowand (WFDR) Risk Services is targeting $12 million in revenue by year-end through introducing insurance products and services to the informal market.
BY TATIRA ZWINOIRA
This comes on the heels of the insurance firm targeting a 25% market share by the end of 2016 expecting contributions from the informal market.
Speaking to NewsDay in Harare yesterday, WFDR general manager Mapiye Chigorondondo said a market report from last year showed that business from insurance brokers had gone down 42% in the formal market as it was no longer functioning at full capacity.
“This formal sector is no longer functioning or operating at maximum, it is closing shop and with that what is happening to the other sector? It is actually going up in terms of the money, so there is potential there,” Chigorondondo said.
WFDR Risk Services is expected to create awareness in the informal sector on the different products they offer to try and capitalise on an informal market which has an estimated cash flow circulation of nearly $7 billion.
The downgrade for insurance firms comes as a result of the worsening economic situation resulting in companies closing down. This makes it difficult to find business in the formal sector.
WFDR are expecting to generate more revenue into the business as a whole through the informal sector.
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By targeting the informal market, Chigorondondo said they were hoping to create an additional stream of revenue by offering products and services to what is an “underserviced market” within the informal sector.
“We also need to focus on segments of the market that have been traditionally underserviced like the informal sector and making available products that the business sector really needs to help them mitigate risks in the current economic climate,” Chigorondondo said.
“In terms of ensuring we do get the market share that we want we want to come up with products that actually target the informal sector because as soon as companies are closed and people retrenched all these people move into the informal sector.”
WFDR Risk Services has been in operation in Zimbabwe since 1977 trading under various names such as Willis Faber Syfrets (Private Limited), Willis Faber and Associates (Private Limited), Willis Corroon (Private Limited) and as Alexander Forbes Risk Services Zimbabwe (Private Limited). It is the corresponding office for the Willis Group whose network of offices spans across the globe.
Local investment vehicle Asimba Private Equity Partners acquired the disposed ZB Financial Holdings shares to become the majority shareholders in the company.
In Africa, insurance premiums are low. Chigorondondo said in Africa as a whole, premiums stand at an average of about 3% as compared to the rest of the world which stands at 8%.
