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ZIMRE Holdings Limited’s South African subsidiary Southern Union Reinsurance has resumed operations although it still needs to be recapitalised. Zimre’s chief operating officer Mr Solomon Tembo said the South African unit started operating at the beginning of the year.
“We are still looking for investors because at the moment SURE is treading cautiously to avoid raising solvency issues with the regulator. We are making sure that it does not assume greater liability than the capital that is in place,” he said.
SURE was placed under curatorship in 2004 after undercapitalisation-induced losses. It later emerged from the curatorship in April 2010 but could not resume operations as it required $14 million in addition to the cash reserve of $3,7 million it had at the time.
Since then Zimre has been looking at attracting both foreign and local shareholders that could inject fresh capital into the business. Recapitalisation will enable SURE to compete favourably in the South African reinsurance market.
SURE is one of several subsidiaries that Zimre has in the region. Zimre Holdings is present in Mozambique through its wholly owned subsidiary Zimre (Malawi), which owns 51 percent in Zimre Mozambique.
Zimre also has a 74 percent stake in Malawi-based United General Insurance Company, which it is offloading to its subsidiary NicozDiamond. It is present in Zambia via its investment in Cavmont Insurance that it bought for $1 million in 2008.
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