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MOTOR and fire insurances have contributed the highest premiums in the insurance brokers sector contributing 63.17 percent of gross premium written in the first quarter. The Insurance and Pensions Commission (IPEC) in a report on short-term (non-life) insurance for the quarter ending 31 March 2013, indicated that motor and fire insurance contributed 47,64 percent and 16,53 percent of gross premium respectively compared to other business classes.
An economic commentator, Mr Bongani Ngwenya said motor and fire insurances contributed the highest premiums during the period under review because of car imports.
“The influx of car imports could have led to the two business classes to contribute the highest premiums because for a vehicle to get registered in Zimbabwe, first it has to have an insurance cover,” he said.
Other business classes notably, engineering, marine, aviation and hire purchase stood at 7,22 percent, 1,77 percent, 0,21 percent and 0,02 percent.
“Total gross premium written by both insurance and reinsurance brokers for the quarter ended 31 March 2013 amounted to $31,7 million compared to total non-life insurers’ gross premium of $66,68 million,” said IPEC in the report.
The commission did not give statistics for the same period in 2012.
IPEC revealed that it had lifted the suspension of Aon Zimbabwe (Private) Limited’s subsidiaries from writing new business following efforts made in regularizing their operational status.
The subsidiaries have already submitted their applications to the commission to enable their registration.
“Insurance brokers reported total profit after tax of $0,62 million for the quarter ended 31 March 2013. The industry’s average return on equity (ROE) and return on assets (ROA) for the insurance brokers for the period under review was 6, 47 percent and 1, 84 percent respectively.”
Pan African Reinsurance Brokers, Aon Zimbabwe (Private) Limited, and Navistar Insurance Brokers with market shares of 13,14 percent, 9,88 percent and 7,23 percent respectively, were the market leaders in terms of premium written during the first three months of 2013 under review.
“Aon lost its market leadership as a result of its suspension from writing new business which was eventually lifted during the quarter under review,” said the report.
IPEC said total assets for insurance brokers decreased marginally from $33, 47 million as at 31 December 2012 to $33, 41 million as at 31 March 2013 with the total assets remaining skewed towards current assets which accounted for 79,08 percent.
Finance Minister Tendai Biti is on record saying low underwriting capacity of the local market was resulting in externalisation of premiums where large risks are involved.
Online Reporter