ZIMBABWE’S oldest funeral service provider Doves Holdings (Doves) plans to open two new funeral parlours in Beitbridge and Chiredzi by year-end as part of the group’s initiative to regain lost market share, CE Talent Maziwisa has said.
By Taurai Mangudhla
Currently, the company has a market share of about 36% and plans to account for about 60% of the cake in the medium to long-term as profitability grows in the sector.
“We will open a new branch in Beitbridge mid-November and another one in Chiredzi by end of year,” Maziwisa said, adding the company’s strategic desire is to have representation in every district across Zimbabwe. Currently, Doves has 26 branches across the country.
A consortium of local investors led by Farai Matsika took over Doves in 2012 and has been investing in the business in the face of growing competition in the market.
“Investment is ongoing since the coming in of new shareholders in 2012. Our focus is on infrastructure investment,” Maziwisa said.
Doves is spreading its wings amid growing competition from eight other funeral assurers that are registered with the Insurance and Pensions Commission (Ipec).
According to the Ipec quarterly report for the period ended June 30 2016, funeral assurers realised US$18,7 million in net premiums written, up from US$18,3 million in June 2015.
Doves registered the highest growth in premiums written at 29% compared to the same period in the prior year, closing the quarter to June at US$6,7 million.
“Given the high retention ratios, the industry is encouraged to consider risk management and in particular reinsurance as a defensive mechanism,” Ipec said in the report.
Total costs shed 4% compared to the same period last year to US$14 million due to expenditure cuts in management expenses. Technical profit for the six months this year was US$4,7 million, up from US43,7 million in the prior year.
Ipec said the expense and combined ratios were reportedly 48% and 75% respectively compared to 54% and 80% in the previous year.
“As at 30 June 2016, total industry assets grew from US$48,5 million reported last year to the current US$56,1 million mainly due to property revaluations,” the regulator said. “The industry continues to show signs that it is viable albeit some challenges relating to premium debtors, capitalisation as well as compliancy to prescribed paper. Various engagements, administrative, and punitive are on course to restore legal and regulatory concerns.”