‘’Strengthen your balance sheets through Strategic and Smart partnerships with the Diasporians, Insurance Companies challenged”
Speaking at the Insurance Institute of Zimbabwe annual conference, Dr. Lovemore Gomera the outgoing President urged Insurance players to strengthen their balance sheets and improve their product offering by tapping into the vast resources in the diaspora. Strategic partnerships can play an effective role in boosting human capital and growth of the insurance industry and ultimately the economy, he said.
Increased competition among financial institutions, a higher capital requirement after the global financial crisis and increasing needs for customer protection force the insurance industry to seek more efficient ways of managing their businesses in order to generate sustainable profits to survive. The challenging market condition has become intense with most if not all insurance companies looking for all the feasible options for survival including consolidation with other insurance carriers, agent and broker networks and even non-insurance financial institutions.
Dr.Lovemore Gomera said, with so many Zimbabweans working in the diaspora, the time has come, to not only explore if and how to create more smart partnerships, but to look more seriously at the scale and implementation of existing partnerships to built capacity .One area of opportunity lies in attracting capital from the diaspora by way of practical collaboration between diaspora organisations, development agencies and local players through mergers and acquisitions to stimulate growth and also facilitate exchange of knowledge, experience and expertise to gain better insights about new risks and vast opportunities to exploit.
Mergers and acquisitions should now dominate conversations in the Boardrooms. Executives and management must advise their Boards and shareholders the effects of poor capitalisation. Weak balance sheets continue to adversely affected business growth within the Zimbabwe insurance industry hence the call for increased capitalization from the Commissioner (IPEC) and the Ministry of Finance.