Paul Nyakazeya, Group Digital Editor 
FIDELITY Life Assurance of Zimbabwe (Fidelity) is planning to expand into the region to position itself for “real growth.”
In a statement accompanying the group’s results for the six months to June 30, 2021 published last week, former group chief executive Reuben Java said Fidelity is adopting a strategy to widen its footprint in the region, with a view to unlock value to shareholders, investors and clients.
“We are committed to creating long-term value for our shareholders and clients. The group will achieve this through asset preservation efforts, that is adopting an investment strategy focusing on real growth, a scrupulous selection of US dollars generating markets and diversifying into the Sadc region,” Java said.
“The group will continue to be innovative in developing financial solutions for customers to align with their changing needs and circumstances,” he said.
Group board chairman, Fungayi Ruwende, said the nearly stagnant official exchange rate and generally depressed property market implied minimal capital appreciation in investment property, which hampered performance.
“Fair value gains on investment property will have reduced impact on profitability in the current year in comparison to the prior financial year,” Ruwende said.
The group recorded net premium written in inflation adjusted terms of $441 million, an increase of 102 percent from $218,3 million recorded prior year.
“The growth is mainly attributable to responsible reviews of recurring premiums, new business acquisition and organic growth from the existing book,” said Ruwende.
The life insurance businesses continue to be the major contributor of total core income growth, contributing 83 percent of total core income. Total income (including investment income) in inflation adjusted terms declined by 67 percent to $933,8 million from $2,8 billion due to insignificant fair value adjustments in investment property and equities.
“Fair values of the investment property are mainly driven by movements in the exchange rate, which was stable during the first half of 2021 compared to the same period prior year,” Ruwende said.
On an inflation adjusted basis, total benefits, claims and other expenses declined by 43 percent from $1,6 billion in 2020 to $920 million in 2021.
The group realised savings on the Southview water pipeline project, with project costs incurred during the period decreasing by 92 percent from $468 million prior year and $39 million current year as the project reaches its tail end.
“The depressed profitability for the group is a result of a decline in exchange rate differences arising from translation of foreign operations and foreign currency denominated assets due to stabilisation in the exchange rate which were experienced in the current year,” said Ruwende.
Total assets declined marginally in real terms to $6,604 billion down from $6,606 billion in 2020.
newsdesk@fingaz.co.zw
