Eagle Insurance Limited is targeting a 12% market share, as the company is confident it has the capacity to pay back claims.
BY TATIRA ZWINOIRA
Eagle Insurance, a part of the FBC Holdings group with a 95% shareholding, posted a profit before tax of $1,7 million at the end of December 2015.
Speaking at the Insurance 50th celebration anniversary last week, managing director Musa Bako said they were still using brokers in their business operations.
“Our target market share is 12% and right now we are at 10%, but we still partner brokers who have been the traditional suppliers in the products that we make. Some of the products that we do, we go with an agent or a registered broker who we will work with and have an exclusive product for them, so they are still relevant,” he said.
“We cover engineering, fire, property and motor insurance. The two cash cows we have, in terms of products, are the hospital cash plan and motor insurance. We are going micro in a big way, in terms of micro insurance. We are looking at the uninsured space (informal market), by wanting to provide insurance to the uninsured with relevant products and solutions for them.”
Eagle Insurance contributed 7% to FBC Holdings group profit before tax for the year ending December 2015, which was down from a previous of 11% over the same time frame the previous year due to market constraints.
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In 2015, the insurance company made a significant investment in new IT systems to improve service delivery and new product deployment, which included improving claims control mechanisms to ensure insurance fraud detection.
Eagle Insurance board chairman Phillip Chiradza said the company wanted to increase its market share despite difficulties in the economy because of its improved capital position.
“The ability to pay claims is very crucial for us, we are well capitalised, well above the limits prescribed by the insurance industry which in terms of capital is $1,5 million and are way beyond $5 million. But also as a member of the FBC Holdings group that is where they come in if ever we should want more cash to pay our claims,” he said.
“We are very confident of our cash reach group in that we have no problems reaching our obligations in term of claims that may arise from our expanded and extended clientele” In December 2010, FBC Holdings became Eagle Insurance’s main shareholders after acquiring a 49% stake from its former shareholders, Zurich Insurance Company South Africa Limited. In 2011, FBC Holdings acquired another 23% stake from Baobab Re to push its total shareholding to 95%.
According, to the Insurance Pensions Commission report for 2015, profit after tax for direct insurance companies went down to $4,62 million in 2015 from $10,25 million in 2014 due to an upsurge in net incurred claims.
