Business Daily (Nairobi)
Steve Mbogo
21 May 2008
Listed insurance company Pan Africa Insurance has reported an increase in its gross premium income from Sh1.39 billion last year to Sh2 billion in the year ending December 2007.
The company's new chief executive , Mr Tom Gitogo, announced expansion plans that will see it open additional branches in Nairobi and new branches in Malindi and Kisumu. He said the bank is seeking ways to diversify product distribution channels.
An analyst from Faida Securities said prospects for insurance companies will be positive with the move to increase distribution channels which will mean more clients and an increase in premium income.
The company said it is now embracing the middle and high income groups in addition to its traditional focus group of low to medium income groups.
The new business focus is expected to bring in new premium income.
The company said it plans to launch a product that will help manage pension awards for the retirees.
"Once most people retire, they get a lump sum and invest its in say a matatu yet they may not know how to manage the business. We shall take this money, invest it and then pay the retiree a monthly income," said Mr Gitogo.
The amount to be paid monthly will depend on the investment returns in a specific period. Pan Africa Insurance will get a percentage management fee. The company said it is likely to increase its investments in the properties currently averaging 10 per cent to about 25 per cent.
But analysts had earlier told Business Daily that insurance companies are likely to face a difficult year because of the market Nairobi Stock Exchange of last year and the decline in market activity earlier this year.
Analysts said insurance companies face a tough year ahead as pressure builds to grow underwriting income, even as claims and fraud from customers continue to rise and a depressed NSE eats into the value of their assets.
The company said individual life income increased by 20 per cent accounting for 18 per cent of total premium income.
The company's balance sheet shows that policy loans increased from Sh198 million in 2006 to Sh304 million in 2007. Its total assets also increased from Sh4.6 billion to Sh5.9 billion in 2007.
Be the first to Write a Comment!
Copyright © 2008 Business Daily. All rights reserved. Distributed by AllAfrica Global Media (allAfrica.com). To contact the copyright holder directly for corrections — or for permission to republish or make other authorized use of this material, click here.
AllAfrica aggregates and indexes content from over 125 African news organizations, plus more than 200 other sources, who are responsible for their own reporting and views. Articles and commentaries that identify allAfrica.com as the publisher are produced or commissioned by AllAfrica.
