Zimbabwe-based insurance services provider ZB Financial Holdings (ZBFH) is set to invest around $10m in the reinsurance market of Mozambique.
The company intends to expand the operations in the country through its subsidiary ZB Reinsurance.
ZBFH Group CEO Ronald Mutandagayi was quoted by ventures-africa.com as saying: "We are entering into Mozambique because the market is growing in terms of foreign direct investment (FDI) and there are opportunities in the Mozambique reinsurance business."
"There is a lot of infrastructure and property development there and we want to tap into these opportunities," he added.
The move is part of the company’s strategy to increase revenue, which decreased by 22% in the first half of 2014 due to a 25% fall in lending income.
The insurance industry in Mozambique is relatively small, which reported penetration rates of 1.45% in 2012.
Mutandagayi was quoted by The Herald as saying that the company intends to increase revenue contribution to reinsurance unit between 5% and 10% to 20%, when expands into foreign markets.
According to Mutandagayi, the reinsurance technical result increased by 16% in the first half of 2014, as a result of treaty participation and more facilitative business.
Mozambique is one of the fastest-growing economies in the world, according to the International Monetary Fund (IMF).
Image: ZB Financial to expand insurance business in Mozambique. Photo: courtesy of PinkBlue/ FreeDigitalPhotos.net.