Botswana Insurance Holdings Limited (BIHL) says it will continue to focus on its key twin strategies of growth and profitability though uncertainty in the global market remains a threat to the business.
In its unaudited financial results for the half period which came to an end on the last day of June 2104, the insurance holding group led by the chief executive officer, Gaffar Hassam says it suffered under achievement on the investment linked individual life business which came as a result of reduced investments returns as compared to the prior period.
The group in its financial statement says in consistent with the real growth in domestic GDP, it has experienced solid new business volumes on all lines of with a growth of 15 percent in premium income over the first half of 2013. “The annuity line which contributes substantially to our single premium income posted a strong recovery which spearheaded the growth in total net premium income from P845 million in the first half of 2013 to P972 in the first half of 2014,” reads the statement.
All business lines have contributed to the growth of the operating profit as it increased by 30 percent year on year P161.7 million from P124.8 million reported in 2013.
“Unit costs were contained within budget and are three percent lower than previous year due to improved new business volumes and disciplined expenditure by management,” the group said.
The insurance market leader however said the general lines business kept on making losses beyond the company’s level of tolerance. As a result, the management said it entered into negotiations with Botswana Insurance Company to sell off the general lines book to BIC and have now received all required regulatory framework.
The expectation is that the migration of the general lines book to be completed mid-September 2014.
The BIHL Group consists of Botswana Life, Botswana Insurance Fund Management (BIFM) in addition to the newly introduced Botswana Insurance Holdings Limited Insurance Company (BIHLIC).