FIDELITY Life Assurance Zimbabwe registered a huge jump of nearly 1 000% in profit after tax to ZWL$101,13 billion in the year ended December 31, 2023, buoyed by huge increases in revenues.
In the comparative period, the company registered a profit after tax of slightly over ZWL$1 billion.
In its latest financial results for the year ended December 31, 2023, Fidelity chairman Livingstone Gwata said the group’s insurance contract revenue stood at ZWL$116,6 billion at the end of the period under review, up 242% from 2022.
“Inflation adjusted insurance contract revenue recorded a strong growth of 242% compared to the previous year from ZWL$34,1 billion to ZWL$116,6 billion. Historical cost insurance contract revenue grew by 962% compared to prior year from ZWL$4,6 billion to ZWL$48,5 billion,” he said.
“The impressive growth in insurance contract revenue was on the back of the group’s innovative product development bearing fruits and increased uptake of the company’s products offering on the market.”
The group recorded significant growth in premium inflows through its Vaka Yako product contributing 83% of the individual life premiums.
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The Zimbabwe operation contributed 62% of the premium inflows, while 38% is attributable to the Malawi operation.
The group’s insurance service result increased by 280%, underpinned by the real growth in insurance contract revenue.
“This is despite an increase in insurance service expenses propelled by the increase in claims and directly attributable costs due to the inflationary environment prevailing in Zimbabwe and the regional business operation,” Gwata said.
Insurance service expenses were recorded at ZWL$34,14 billion at the end of the period under review, from a 2022 comparative ZWL$12,09 billion.
The increase in revenue also included a 91% growth in net investment income to nearly ZWL$71 billion, from the 2022 comparative.
This was driven by fair value gains from investment property, equities and interest income from money market investments.
However, the net change in investment contract liabilities stood at ZWL$81,29 billion during the period, from ZWL$4,86 billion in 2022.
“The business remains on high alert to these activities and will continue to monitor and carefully adapt to these changing circumstances to deliver value to its key stakeholders,” Gwata noted.
“The business will be preserving its cash wallet through responsible spending and targeted investment into products that survive the test of time. Innovation will be key in also driving the products that create and preserve shareholder and policyholder value.”
He said Fidelity’s goal was to leverage on building and delivering sustainable insurance products and services to clients and stakeholders.
In terms of assets, these were valued at ZWL$483,77 billion, up nearly 79% from the 2022 comparative, driven by investment properties.
Gwata, however, noted that the group needed to strengthen its capital position.