TIRA releases new insurance results, says underwriting loss cut signi

09Jan 2019
By Financial Times Reporter
Dar es Salaam
Financial Times
TIRA releases new insurance results, says underwriting loss cut signi

THE Tanzania Insurance Regulatory Authority (TIRA) last week published performance results of the industry during the first nine months of last year, which among other things show that general insurers continued to make underwriting loss.

The Commissioner of Insurance, Dr Baghayo Saqware.

However, compared to the corresponding period in 2017, the loss was over 61 per cent lower. Overall, the market grew by over seven per cent in terms of gross premiums written but the regulator says this performance was slightly below the set target of 10.5 percent annual premium growth for the industry.

“The general insurance underwriting result made an underwriting loss of 5.0 billion/- in the nine months period to September 30, 2018, compared to a loss of 13.1 billion/- of the similar nine months period of last year. This reflects a significant decrease of the underwriting costs,” reads the new report.

“From an investment point of view, general insurers attained investment income amounting to 27,974 million/- in the period ended 30 September 2018, having increased by 3.6 percent compared to an investment income of 26,995 million/- earned during the similar period in 2017. On the other hand life insurers attained investment income amounting to 7,545 million/- in the period ended 30 September 2018, having increased by 18.4 percent compared to an investment income of 6,375 million/- earned during the similar period in 2017,” it adds.

Service Providers
During the nine-month period, the market was served by 31 insurers of which 25 were transacting general insurance business and one provided life assurance services. The industry also comprised one composite insurance company providing both general and life insurance cover as well as one local reinsurer.

Apart from Tanzania Reinsurance Company Limited, the market was also served by 31 foreign reinsurance companies and 41 reinsurance brokers. Other key market players were 611 agents, 56 assessors and 98 brokers, who alone accounted for 46.3 per cent of the total insurance premium written during the period.

Market Growth
“The market grew by 7.7 percent in gross premiums written to 527,962 million/- in the period ended 30 September 2018 as compared to 490,364 million/- of the similar period prior year,” the Commissioner of Insurance (COI), Dr Baghayo Saqware notes in the report.

According to him, general insurance business experienced a growth of 4.2 percent in gross premium written from about 431.3 billion/- during the period ended 30 September 2017 to around 449.3 billion/- during the period under review. Life assurance business volume increasedby 33.3 percent from nearly 59 billion/- to about 78.6 billion/-.

Asset Position & Investment Portfolio
Total assets of insurers increased by 11.7 percent to 908,929 million/- from 813,949 million/- whereas total insurers’ investments increased by 11.3 per cent from 569,133 million/- in September 2017 to 633,685 million/- in September 2018.

The largest share of insurers’ investment assets comprised of deposits in financial institutions (including cash and bank balances) (51 per cent), followed by government securities (23 per cent), real estates (13 per cent), shares (11 per cent), investments in related parties (two percent) and other financial investments (one percent).

Brokers
The COI said that brokers remain to be a significant insurance intermediation force in the industry. During the period under review, they were involved in premiums worth over 244 billion/-.

“Out of the total insurance premiums written during nine months (January to September 2018) in respect of both long – term and general insurance businesses (528.0 billion/-), 46.3 per cent amounting to 244.2 billion/-was transacted through brokers,” TIRA says in the report.

According to it, 87 brokers participated in transacting general insurance business, who collected 225.7 billion/- in general insurance premium. The report also has it that 15 brokers transacted long-term assurance business and managed to collect 18.5 billion/-premium.

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