Kenya Re scouts for South Africa business

By FREDRICK OBURA

The Kenya Re Insurance Corporation is scouting for new business frontiers in southern Africa.

The major player in the reinsurance market said, apart from Nigeria, it would open an office in South Africa.

Kenya Re Chairman Nelius Kariuki said the firm paid out about Sh3 billion in net claims against major marine accidents and fire accidents.

 “We are excited about these achievements due to our dedicated team, going forward needs more work as 2012 promises a challenging business environment,” said Kariuki.

“We are looking at opening up a full branch in Southern Africa to serve growing market in that region,” she said during the firm’s Annual General Meeting in Nairobi.

 “Zambia, Botswana, Zimbabwe and Mozambique are in our consideration for better tax regime.”

The corporation expressed concern over fire related claims, which  raised the number of compensation last year compared to the previous year.

“Fire outbreak is a potential threat to the insurance industry, we have witnessed this not only in Kenya but to other markets like Middle East and other parts of Africa where we operate,” said Jadiah Mwarania, managing director, Kenya Re.

“We are on the drawing board on how to manage the claims emanating from fire outbreaks,” added Mwarania. Net claims incurred increased from Sh2 billion in 2010 to Sh2.94 billion last year.

The corporation made an underwriting loss of Sh193 million last year, from a profit of Sh76 million in 2010. During the year ended 2011, the corporation however realised impressive performance in other facets of its operations.

Pre-tax profits grew by 23 per cent from Sh1.6 billion in 2010 to Sh2 billion last year. The growth resulted from strong investment returns and cost containment measures that saw operating expenses grow at 11 per cent, a level lower than the mean inflation rate last year.

The corporations profit after tax increased by 24 per cent from Sh1.4 billion in 2010 to Sh1.9 billion last year. Gross Premiums written grew by 33 per cent from Sh4.9 billion in the year 2010 to Sh6.6 billion last year.

Kariuki attributed to stable macro-economic environment, focused marketing and wise choice of insurance markets.