FMHL profit drops 12%
FAITH MADZINGA
First Mutual Holdings Limited ‘s profit dropped 12% in the 12 months to December 31,2021 to ZWL$3.2bn from ZWL$3.8bn reported in the previous year due to a surge in expenditure despite a growth in income.
Total income for the financial services group stood at ZWL$21.3bn in the reviewed period from ZWL$12.3bn reported in 2020, reflecting a 73% growth.
Gross premium written (GPW) for First Mutual Life Assurance Company grew 119% to ZWL$1.83bn in the reviewed period.
Group CEO, Douglas Hoto attributed the increase to “inflation related adjustments by employers to basic salaries that drive pension contributions and group life assurance covers in the Employee Benefits division”.
He also said the underwriting of foreign currency denominated products as well as higher Zimbabwe dollar assurance covers contributed to higher revenue in the retail division.
The GPW in First Mutual Health Company, grew 70% to ZWL$5.4bn.
The claims ratio increased to 81.17% from 73.21% in the same period owing to increased access to services by members and charges by service providers rising faster than premiums paid by members.
At NicozDiamond Insurance Limited, GPW grew by 34% to ZWL$4.43bn due to continuous asset value revisions to protect clients against insurance value erosion through inflation and organic growth within the existing portfolios.
Hoto said there was an increased preference for USD denominated policies by clients as a hedge against insurance value erosion in local currency. The claims ratio at 35% was in line with the prior year ratio of 36% mainly as a result of continued lockdowns.
GPW at its Botswana based FMRE Property and Casualty, grew 4% to BWP179.1m.
Revenue for the First Mutual Properties Limited, grew 38% to ZWL$582m in 2021 due to rental reviews in line with inflationary trends and an increase in the occupancy rate to 89.33% in 2021 compared to 88.22% in 2020.
