Audrey Galawu
ASSISTANT EDITOR
New business acquisitions prove worthy for Zimre Holdings, records increase in insurance contracts.
Zimre Holdings Limited’s Reinsurance and Reassurance segment insurance contract increased by 23% to ZWL$210 billion from ZWL$171.1 billion in inflation-adjusted terms compared to same period prior year, and grew by 1,906% to ZWL$140.4 billion under historical cost terms.
In a trading update for the first quarter of 2024, Zimre said the growth was driven by new business acquisitions and increased market share in Zimbabwe and the regional operations.
“The segment continues to expand its reach, making inroads into new markets across North and Central Africa. Geographical diversification remains a key strength, providing a robust hedge for the Group’s performance.
“Following the successful merger of the two Botswana reinsurance entities and the recapitalisation of the Mozambique subsidiary, the segment is poised for further improvement with enhanced underwriting capacity in new business classes,” reads the update.
The short-term insurance business witnessed a remarkable growth in direct business increasing from 33% to 46% in the current period ending March 31, 2024.
This led to a modest growth in insurance contract revenue, rising by 43% to ZWL$7.5 billion in inflation-adjusted terms, and grew by 254% to ZWL$1.4 billion from ZWL$0.4 billion in historical cost terms.
“The segment’s profitability was enhanced due to a reduction in acquisition costs, decreasing from 31% to 27% compared to the same period last year.
“The property segment continues to thrive, posting a 62% revenue growth to ZWL$6.8 billion in inflation-adjusted terms and a 1,172%increase to ZWL$6.7 billion from ZWL$0.5 billion in historical cost terms during the period under review. This sustained growth underscores the property market’s resilience and appeal as a preferred investment haven, driven by its value preservation qualities and ability to withstand inflationary pressures.
“During the review period, the portfolio exhibited a collection rate of 90% on average, slightly below 93% recorded in the first quarter of 2023, while portfolio voids averaged 15%, a remarked improvement from the 22% reported in the first quarter of 2023, given the ongoing trends of workspace optimisation by office tenants.”
The Life and Pensions segment also recorded a strong growth, with insurance contract revenue increasing by 20% to ZWL$65.7 billion in inflation-adjusted terms and a 92% surge to ZWL$37.4 billion from ZWL$3.6 billion in historical cost terms for the period in question, compared to the same period last year.
The growth in this division has been attributed to strategic acquisition of new business and innovative product development.
The Group expects the Eagle REIT project to drive the property portfolio strategy towards high yielding commercial and retail sectors.
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