Two insurance firms undercapitalised, premiums up 8pct

Two insurance firms undercapitalised, premiums up 8pct

By Bernard Mpofu, HARARE, March 28 (The Source) – Two short-term insurance companies failed to meet minimum capital requirements as the sector registered an 8,1 percent year-on-year growth in gross written premiums for the fourth quarter to December 31, slowing down on previous years, an official report has shown.

All operating direct non-life insurers, except Excellence Insurance Company and Sanctuary Insurance Company reported capital positions which were compliant with the minimum regulatory requirement of $750,000, the Insurance and Pension Commission said in its fourth quarter 2013 non-life report.

The number of registered non-life insurers increased in the quarter following the registration of Safel Insurance Company. However, five of the registered non-life insurers remained non-operational.

“The annual growth in the volume of business written slowed down in 2013 in line with the slowing

down of annual growth rates in many sectors of the economy,” read the report.

“Non-life insurers reported an industry average solvency margin of 59 percent as at 31 December 2013, which compares unfavourably with 60 percent that was reported as at 30 September 2013.”

The annual growth rate in gross written premiums (GWP) was eight  percent in 2013 compared to 53 percent, 36 percent and 22 percent, and reported in 2010, 2011 and 2012.

Net written premiums in 2013 were up 10 percent compared to 112 percent, 29 percent  and 21 percent in 2010, 2011 and 2012.