The life assurance industry’s net premium income increased by four percent in 2016 to $347 million from $334 million recorded in the previous year, the latest report by the Insurance and Pension Commission (IPEC) shows.
IPEC said the industry was compliant with the minimum capital requirement of $2 million for both life assurers and life reassurers.
Nevertheless, the regulator said players must plan for the introduction of the new minimum capital requirements proposed in the 2016 National Budget of $5 million.
Life assurers reported outstanding claims of $2.8 million compared to $3.3 million in the prior year, a position which IPEC said should be rectified to ensure that all legitimate claims are settled on time.
Total costs grew by 23 percent to $299 million in the period from $242 million recorded in the preceding year as a result of once-off expenses such as acquisitions of new Information Communication Technology Systems, staff rationalisation and purchase of hearse fleets, IPEC said.
The life assurance industry reported a favourable combined ratio of 87 percent in 2016 resulting in an operating profit of $48 million.
Total assets grew by 9 percent to $1.68 billion in the period under review from $1.54 billion as at December 2015, attributable to increased investments in properties and equities and the registration of FBC Reinsurance as a composite insurer.
Prescribed assets grew by 10 percent to $169.6 million as a result of engagement measures and increased appetite by the industry players due to favourable returns.
“This increase in the compliancy level is attributable to the Commission’s engagement efforts with industry players and the increased appetite for prescribed assets”, said IPEC.
The prescribed assets ratio was 12 percent as at December 31, 2016 against a minimum statutory requirement of 7.5 percent.
Zimbabwe had 11 life assurance companies operating as at December 31, 2016 according to IPEC.
Alfin Life is currently under liquidation and did not transact any new business during the period under review. – The Source