The sale of General Lines Insurance Book by Botswana Insurance Holdings Limited (BIHL) to Botswana Insurance Company (BIC) does not mean BIHL is exiting the short term insurance industry, group CEO Gaffar Hassam has disclosed.
In fact, Hassam has said they will continue to work with BIC to help where possible but said the deal will allow them to give their clientele the best services they deserve through the sale of insurance book.
Hassam said the decision to sell the general lines insurance book was influenced by the fact that, through the insurance book, the group was unable to reach the market as much as desired resulting in the insurance book business posting a series of unimpressive results.
As market leaders with an estimated market share of around 80 per cent, Hassam said they had to take the decision to offload the general lines insurance book, explaining that through the transaction, which is valued at P6 million, service delivery and product quality will be of high standards.
Speaking during the insurance group’s presentation of half year financial performance, Hassam did not confirm nor deny if the sale of general lines insurance book mean the group is on the edge of buying in BIC. “At this point in time I cannot rule out anything but it is not something on the table,” Hassam said.
Hassam said anything can happen, giving a hint that the acquisition of BIC operations by BIHL Group might just be on the cards. The BIHL Group consists of Botswana Life, Botswana Insurance Fund Management (BIFM) in addition to the newly introduced BIHL SURE!
It is under the BIHL SURE! Subsidiary that the general lines insurance book was contained together with Legal Guard which will as yet remain under the operations of the same subsidiary, according to the group CEO.
Explaining why they chose to sell the insurance to BIC, Hassam said the decision was taken after looking at the reputation of BIC in the insurance industry. In May this year, BIC issued a statement that it was in the process of discussing a potential acquisition. This was followed by another statement this week from BIC confirming that acquisition of general lines insurance book has went through as regulatory approvals for the transaction have been obtained while legal documentation pertaining to the acquisition has also been obtained.
According to the statement from BIC, the transition has brought on board additional skills from BIHL SURE!