Fidelity Life Assurance of Zimbabwe Reports 45% Increase in New Retail Business for Q1 2024

Published On: August 7, 2024Company: Fidelity Life Assurance of Zimbabwe Limited (FIDL.zw)
What is the expected impact of the new structured currency, Zimbabwe Gold (ZIG), on the local economy?
Despite the current economic challenges and uncertainties, the structured currency, Zimbabwe Gold (ZIG), is expected to slow down the depreciation of the local currency. However, it is under pressure due to market uncertainties and lack of confidence. Its effectiveness will largely depend on the successful implementation of supporting policies and its acceptance and increased use among the population.

Economic Landscape

  • The local currency experienced a significant depreciation, resulting in a surge of in-country prices and a spike in annual year-on-year inflation.
  • Despite these challenges, a new structured currency, Zimbabwe Gold (ZIG), is expected to slow down the decline, though it is under pressure due to market uncertainties and lack of confidence.
  • The use of foreign currency for local transactions is likely to remain prominent in the short to medium term.

Business Operations Review

  • The life and pensions business demonstrated strong growth in insurance contract revenue, contributing considerably to the group’s overall success.
  • The Individual Life division performed outstandingly, with a 45% surge in new retail business attributable to the popularity of the Vaka Yako product.
  • Substantial profit was posted after tax for the period.

Micro lending business

  • Micro-lending business saw a significant increase in interest income.
  • Growth in this segment was driven by an expansion in new business.
  • The company demonstrated sustainable lending practices by allocating around 5% of loan disbursements to clean energy-related products.

Non-insurance businesses

  • There has been impressive revenue growth in the Actuarial Consulting Services and Asset Management sections.
  • Expansion in new business pipelines has fueled this growth.
  • Asset management noted a 12% growth in funds under management.

Outlook

  • Despite significant challenges, the company remains confident in its strategies and brand, attributing this optimism to its ability to provide a diverse range of products and services to meet the needs of its target market.
  • The products and services are designed to be resilient and adaptable, positioning the company favorably to weather current headwinds.

Useful links

About Fidelity Life Assurance of Zimbabwe Limited (FIDL.zw)

Fidelity Life Assurance of Zimbabwe Limited is a holding company providing products and services for life assurance, employee benefits, asset management, medical insurance, funeral assurance provision of actuarial services and residential property development. This includes managing pensions, funeral insurance and microfinancing in the informal banking market. Fidelity Life Assurance Zimbabwe offers additional products for individual loans, salary-based loads and loans for farmers. Its actuarial services include life and general insurance services, healthcare insurance, investments and finance and funeral assurance schemes. Its asset management services include unit trusts, money market funds, equity funds, balanced funds and advisory services. Its medical aid services include an access health package, express health package and a foundation health package. The company operates in Zimbabwe and Malawi, with the latter offering products for life assurance and pensions. Fidelity Life Assurance of Zimbabwe Limited is listed on the Zimbabwe Stock Exchange

Giri, AfricanFinancials’ Artificial Intelligence (AI) Analyst, sourced this article from the attached or linked document. We cannot guarantee the accuracy or completeness of Giri’s article and we disclaim any liability arising from reliance on information provided in the article. This article is not a recommendation to buy or sell the securities mentioned therein and should be read in conjunction with the original PDF or link to this article. Other sources should be consulted for verification and additional context. Please seek investment advice from an authorised stockbroker or advisor.

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