[2008-05-22]  Pan Africa Insurance moves to increase outlets
Listed insurance company Pan Africa Insurance has reported an increase in its gross premium income from KSh1.39 billion last year to Sh2 billion in the year ending December 2007. The company’s new chief executive, Mr. Tom Gitogo, announced expansion plans that will see it open additional branches in Nairobi and new branches in Malindi and Kisumu. He said the bank is seeking ways to diversify product distribution channels. An analyst from Faida Securities said prospects for insurance companies will be positive with the move to increase distribution channels which will mean more clients and an increase in premium income. The company said it is now embracing the middle and high income groups in addition to its traditional focus group of low to medium income groups. The new business focus is expected to bring in new premium income. The company said it plans to launch a product that will help manage pension awards for the retirees. “Once most people retire, they get a lump sum and invest its in say a matatu yet they may not know how to manage the business. We shall take this money, invest it and then pay the retiree a monthly income,” said Mr. Gitogo. The amount to be paid monthly will depend on the investment returns in a specific period. Pan Africa Insurance will get a percentage management fee. The company said it is likely to increase its investments in the properties currently averaging 10 percent to about 25 percent. But analysts had earlier said that insurance companies are likely to face a difficult year because of the market Nairobi Stock Exchange of last year and the decline in market activity earlier this year. Analysts said insurance companies face a tough year ahead as pressure builds to grow underwriting income, even as claims and fraud from customers continue to rise and a depressed NSE eats into the value of their assets. The company said individual life income increased by 20 percent accounting for 18 percent of total premium income. The company’s balance sheet shows that policy loans increased from KSh198 million in 2006 to KSh304 million in 2007. Its total assets also increased from KSh4.6 billion to KSh5.9 billion in 2007.


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