Fidelity Life Assurance company drive group’s reve...

Fidelity Life Assurance company drive group’s revenue growth

Audrey Galawu

Assistant Editor

Fidelity Life Assurance company spurred the group's revenue growth, achieving an impressive ZWL$261.37 billion in total revenue.

This exceptional performance was fuelled by a remarkable 230% increase in insurance contract revenue and a significant 271% surge in other income, largely driven by investment income.

“The company's strategic focus on new business acquisitions and innovative product development ignited market demand, resulting in a substantial uptake of products. The investment strategy delivered impressive returns, preserving and enhancing policyholder and shareholder value,” reads the company’s update.

Management's cost containment efforts yielded positive results, with total expenses growing at a slower rate of 118 compared to the 230% growth in insurance contract revenue.

Notably, the company achieved an inflation-adjusted profit of ZWL$258.12 billion, a turnaround from the loss of ZWL$15.23 billion in 2022.

Inflation adjusted insurance contract revenue recorded a strong growth of 242% compared to prior year from ZWL$34.1 billion to ZWL$116.6 billion. Historical cost insurance contract revenue grew by 962% compared to prior year from ZWL$4.6 billion to ZWL$48.5 billion.

The impressive growth in insurance contract revenue was on the back of the group’s innovative product development bearing fruits and increased uptake of the company’s products offering on the market.

Significant growth in premium inflows was witnessed through the Vaka Yako product contributing 83% of the Individual Life premiums.

The Zimbabwe operation contributed 62% (2022:56%) of the premium inflows whilst 38% (2022: 44%) is attributable to the Malawi operation. Insurance service result increased by 280% on an inflation adjusted basis and increased by 1598% under historical cost underpinned by real growth in insurance contract revenue.

This is despite an increase in insurance service expenses propelled by the increase in claims and directly attributable costs due to the inflationary environment prevailing in Zimbabwe and the regional business operation.

“As we continue to adapt to changing market dynamics and embrace emerging technologies, we have embarked on a Group wide digitalization and systems upgrade aimed at enhancing convenience at all our customer touch points.

“We continue to seek both private and public partnerships with market players that align to our brand ethos of exceptional service delivery and value. This is in line with our dedication to offer relevant, all-inclusive products which cut across peak and bottom of the market spectrum,” chairman, Livingstone Gwata said.

Net investment income grew by 91% compared to prior year from ZWL$37.0 billion to ZWL$70.8 billion on an inflation adjusted basis. Historical cost net investment income grew by 241% compared to prior year from ZWL$20.8 billion to ZWL$71.0 billion. The major drivers being fair value gains from investment property, equities and interest income from money market investments.

The group profit for the period increased by 9945% on an inflation adjusted basis from ZWL$1.0 billion to ZWL$101.1 billion.

Under historical cost, profit for the period grew by 541% from ZWL$38 billion to ZWL$243.4 billion. The positive profit growth was driven by the increase in insurance contract revenue and investment income.