NON-life insurance companies’ profit after tax surged to $3,83 million during the first quarter of 2017 due to a rise in net premium written and reductions in operational expenses.
BY FIDELITY MHLANGA
The surge was from a previous of $2,39 million during the same period under review in 2016.
According to the 2017 Insurance and Pensions Commission (Ipec) first quarter report non-life insurers reported an increase in total gross premium written (GPW) amounting to $68,22 million for the quarter ended March 31 2017.
This compared to $66,59 million reported during the same period in 2016.
The asset base for the insurance industry also increased to $409,62 million as at March 31, 2017 from $390,30 million over the same period in 2016.
“The non-life insurance industry reported an industry average prescribed assets ratio of 12,3% as at March 31, 2017, which was compliant with the minimum requirement of 5%. Only eleven out of the twenty operating insurers were compliant with the minimum prescribed assets ratio. A total of two insurers did not have any investments in prescribed assets. It is a statutory requirement for Insurers to invest in prescribed assets,” Ipec said.
The industry average prescribed asset ratios for non-life insurers and reinsurers were 12,3% and 13,64% respectively as at 31 March 2017, compared to the minimum requirement of 5%.
- Chamisa under fire over US$120K donation
- Mavhunga puts DeMbare into Chibuku quarterfinals
- Pension funds bet on Cabora Bassa oilfields
- Councils defy govt fire tender directive
Keep Reading
The report noted that the number of registered players, including insurance agents and loss adjusters, increased to 575 as at March 31, 2017 from a previous of 573 during the comparative period in 2016.
Insurance brokers generated $24,09 million of gross premium for the quarter ended March 31 2017, a 2,02% decline from the $24,59 million written for the quarter ended March 31, 2016.
The business written by reinsurers also decreased to $32,60 million for the quarter ended March 2017 from $35,52 million written for the quarter ended March 31, 2016.
Reinsurance brokers contributed 52,7% of the reinsurer’s total premiums, writing $17,18 million premiums for the quarter ended March 31, 2017.
Ipec report noted that of the 20 operational insurers and eight operational reinsurers, only one player, a reinsurer reported a capital position below the regulatory minimum capital requirement of $1,5 million as at March 31, 2017.
As at March 31, 2017, 11 of the insurers were already compliant with the proposed $2,5 million capital level.
“However, 9 insurers and 1 reinsurer were not compliant with the minimum prescribed asset ratio. The retention ratio, which shows risk appetite, for insurance companies averaged 59,70% as at March 31, 2017, increasing from the 53,90% average as at March 31, 2016. There was however, a decline in the retention ratio for non-life reinsurance companies from 63,85% to 56,23% reported as at March 31, 2016 and 2017 respectively,” noted the report.
Non-life reinsurers reported a profit after tax of $3,03 million for the quarter under review, which is a decrease from $3,82 million reported for the quarter ended March 31, 2016.
