Reliance Insurance Company (Tanzania) Ltd

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Reliance Insurance (Tanzania) Limited (2022-02)
  • Reliance Insurance Company (Tanzania) Ltd
  • Year : Feb 2022
3 Tokens
USD 300.00
Summary

Risk adjusted capitalisation remained within strong levels, despite moderations experienced in FY20. On account of net losses incurred and dividend distribution of about TZS140m, the insurer’s capital base slightly moderated to TZS16.0bn (FY19: TZS16.3bn) while increasing its underlying risk exposures. In this respect, the GCR Capital Adequacy Ratio (“CAR”) reduced to 2.2x (FY19: 2.8x). Similarly, the entity’s statutory CAR also reduced to 2.3x (FY19: 2.7x). Going forward, we expect GCR CAR to be within 2.1x-2.4x, bolstered by internal capital generation.

Additional Information

The Stable Outlook reflects GCR’s expectations of stability in capitalisation, while factoring in the likelihood of net earnings improvements. Accordingly, the GCR CAR is projected to trend above 2.2x in the near-term. While underwriting pressures are seen to persist, it may be offset by investment income. Positive rating action may ensue from sustained profitable growth and risk adjusted capital improving to above 2.6x, as other credit protection metrics are maintained at similar levels.

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