Ambassador Francis Muthaura has ended his four-year stint at the helm of financial services company Britam’s board.
The firm said on Thursday the career civil servant and Moi/Kibaki-era bureaucrat retired as the Chairman of Britam Holdings with effect from August 23 after attaining the mandatory retirement age of 70 years.
He was appointed in 2013, replacing long-serving Nicholas Ashford-Hodges, who resigned from the post.
Mr Muthaura will be replaced by Walter Andrew Hollas, a former senior partner and chief executive at PriceWaterhouseCoopers.
“Francis Muthaura has retired as the chairman and director of the Britam Holdings Plc with effect from August 23, having attained the age of 70 years in line with the best practices of corporate governance,” said Britam in a notice to the Nairobi Securities Exchange.
Mr Hollas, who joined Britam only two years ago having replaced Equity Bank Chief Executive James Mwangi, takes the reins at a time when the firm is smarting from reduced profitability due to new regulations.
In its half-year results released on Thursday, the company suffered a 44 per cent dip in net profit from Sh1.7 billion in 2016 to Sh995 million in the half-year to June this year over increased insurance claims.
Net insurance claims, increase in policyholder benefits and loss adjustment expenses went up from Sh3.6 billion to Sh6.6 billion.
“We continue to be distinguished in the market in settling claims. This is a reflection of our commitment to our customers,” said Britam Group Managing Director Benson Wairegi at a press briefing in Nairobi.
He also attributed the doubling of expenses to adjustment from net premium valuation (NPV) to gross premium valuation (GPV) introduced by new requirements of the Insurance Act as amended by the Finance Act 2015.
NPV is thought to be a very conservative actuarial model, which does not look at all other risks. This method is, therefore, not well-suited for the new Risk Based Capital (RBC) introduced by the Insurance Regulatory Authority.
GPV looks at the actuarial liabilities based on gross/office premiums and explicitly allows for all risks - interest rates, mortality, expenses, and persistence.
The firm, however, said it had achieved operational efficiencies through its new IT solution, Jawabu, including centrally managing all subsidiaries in the region.