It is my pleasure to report that the CBZ Insurance Operations posted yet another commendable performance in spite of challenges in the operating environment.
The Non-Life insurance industry witnessed growth of 3.2% in Gross Premium Written (GPW) from US$208.0 million for the year ended 31 December 2014 to US$214.7 million for the year ended 31 December 2015. Comparatively, the Life industry registered a growth of 11% for the year to 31 December 2015 from US$300 million to US$332 million.
The short term insurance industry premium written remained mainly skewed towards motor, fire and accident insurance products, with these accounting for a total of 80% of total gross premium written during the year. On the other hand Employee Benefits products constituted 61% of the Life business written for the same period whilst the balance of 39% was from individual life related products.
The growth of the insurance sector in particular has been stifled by the myriad of challenges stemming from liquidity challenges. This resulted in low capacity utilisation, which affected premium collection and starved the sector of the much needed premium revenue.
During the year, the regulator revised the minimum capital levels for Insurance industry players. This has seen the minimum capital for short term players increasing to US$2.5 million from US$1.5 million whilst that for Life business has been increased from US$2 million to US$5 million. Compliance with the new capital levels is expected by 31 December 2016. These new levels have already been achieved
To complement the exploration of synergies within the CBZ Group in pursuit of Gross Premium Income, the Insurance Operations have built a strong agency distribution force to source for insurance business. The diversification of the company’s product lines has also helped cushion the impact of the harsh operating environment to continuously create value for stakeholders.
The company operated profitably, recording a 78% growth in profit after tax compared to prior year. Below are the key highlights of the company’s performance for the year and comparative period.
The company operated profitably, recording a 123% growth in profit after tax compared to the prior year. Below are the key highlights of the company’s performance for the year and comparative period.
The Insurance business seeks to employ relevant technology with a view to improve productivity and efficiency in line with the strategy on improving the overall customer experience. Platforms are designed to handle high customer and transaction volumes. In this view the company continues to invest in information technology in line with this strategy.
The Insurance Operations were rated by the Global Credit Rating Company (GCR) during the year for the first time. CBZ Life (Private) Limited was awarded a Financial Strength Rating of BBB+ with a stable outlook, while CBZ Insurance (Private) Limited received Claims Paying Ability Rating of BBB, with a positive outlook. These ratings indicate that the entities have strong financial security characteristics and adequate claims paying ability respectively.
Policyholders are essential for the success of our business. We have up scaled our efforts in product development and delivery channel diversity, to provide seamless service to our clients. In this light, as part of the CBZ Group, we have launched a 24 hour Contact Centre for enhanced convenience to our customers.
We continue to look at ways to simplify the organisation so as to enhance the speed of executing our service to our valued customers. The Operations’ distribution channels, type of business, marketing, reinsurance and retention of already acquired business, continue to be reviewed with a view of strengthening the business underwriting position. Confidence is high that the strategies lined up for the year 2016, will once again yield the desired results.
I would like to thank our valued customers for their continued loyalty. I also wish to extend my gratitude to the CBZ Insurance and CBZ Life Boards, management and staff, for their performance and support to the organisation. My appreciation also goes to fellow subsidiary companies of the Group and the Group’s Executives for their unwavering support.
25 February 2016