CIC Insurance goes regional with Sh1bn war chest

CIC Group chief executive officer Nelson Kuria. CIC Insurance will commit Sh1.3 billion from proceeds of its recently oversubscribed bond to regional expansion. PHOTO | SALATON NJAU |  NATION MEDIA GROUP

By NATION CORRESPONDENT
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CIC Insurance will commit Sh1.3 billion from proceeds of its recently oversubscribed bond to regional expansion.

The cash call received bids worth Sh6.34 billion, more than double the Sh3 billion targeted under a two-phase offer.

It, however, exercised the green shoe option to raise the required Sh5 billion in the first phase and did away with the second.

“Our intention is to ride on the developed cooperative model in the region to establish joint ventures,” CIC chief executive Nelson Kuria said.

He said the listed insurer will be seeking joint ventures with the cooperative union of Uganda and Malawi counterpart in the drive. The insurer was licensed in August by the South Sudanese Government and started operations through a joint undertaking with the cooperative movement in the country.

Proceeds from the cash call are also expected to fund the firm’s plans to enter healthcare business as it seeks to grow the under-performing unit.

In the 2013 financial results, the insurer blamed increasing cases of fraudulent claims for a marginal profit growth of 1.4 per cent to Sh1.4 billion after-tax earnings. Medical claims surged 30 per cent to Sh6 billion.
“We also seek to redevelop our medical unit to boost the division,” Mr Kuria said.