Buyanga buys Cell funeral assurance?

HARARE - Flamboyant businessman Frank Buyanga has reportedly acquired Cell Funeral Assurance Company (Cell Funeral), businessdaily has learnt.

While Cell Funeral general manager Paidemoyo Madziwa-Mahundi could neither confirm nor deny the development, she said her company would clarify the issue soon.

“We would like to advise that Cell Funeral will be issuing a statement in relation to this matter in due course,” she said. 

In the meantime, Buyanga could not be reached for comment as he had not responded to several inquiries at the time of going to print.

However, sources say the self-styled financier and property investor could be looking at consolidating his Hamilton Insurance business with the latest acquisition.

The 34 year-old businessman also operates Hamilton Property and a micro-financing outfit.

The maverick entrepreneur, famed for his lavish lifestyle and top-of-the-range cars, has actually been operating out of the funeral assurer’s Herbert Chitepo offices in Harare, insiders say.

While the sector is dominated by Doves and Phillip Mataranyika’s Nyaradzo Group, the Cell Holdings subsidiary has also emerged as one of the funeral giants in Zimbabwe.

In recent years, it has launched a unique product called “rent-a-captive” and as it seeks to grow its footprint in the highly-lucrative sector.

As a company, which offers a self-funded funeral service to organized groups and companies, Cell Funeral also provides conventional assurance plans and other associated services.

Industry regulator the Insurance and Pensions Commission (IPEC) had also not responded to inquiries – to give clarity on the alleged deal or acquisition – by the time of going to press.

Meanwhile, Mannet Mpofu’s organisation has said in its latest report that Zimbabwe’s tough economic situation was weighing heavily on the insurance sector and called on funeral assurers to unveil micro insurance products.

The funeral assurance industry, IPEC said, is also facing competition from mainstream financial institutions’ entry into the insurance business.

The tightening liquidity crunch, continued company closures, increasing informalisation of the economy and low disposable incomes, have forced the banking sector to diversify into sectors including construction projects, medical aid and insurance, among others.

According to IPEC, the funeral industry wrote $19 million in net premiums in the six months to June this year compared to $16 million recorded in June 2013.

In the period under review, total costs grew by 10 percent to close the first half of the year at $14 million from $13 million reported in the same period last year.

Players reported $5 million in operating profit up from $4 million registered in the prior period.

The expense and combined ratios were reportedly 49 percent and 73 percent respectively.

“As at the current reporting period, total assets were $45 million from $36 million reported as at June 30, 2013. The industry must comply with prescribed assets requirements as the compliance rate is very low as reflected by only three players being compliant,” said IPEC.

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