CIC hires former Pan Africa boss in succession plan
Former Pan Africa chief Tom Gitogo (left) with Chandaria Foundation trustee Hirji Shah and Britam’s Stephen Wandera at the Company of the Year Awards in Nairobi last year. PHOTO | FILE
What you need to know:
Mr Gitogo, who resigned from Pan Africa last week after six years at the helm, will hold the position of deputy Group chief executive before the expected retirement of Mr Kuria.
Mr Gitogo will be inheriting a bigger operation at CIC relative to Pan Africa.
CIC collected Sh11 billion in gross premiums last year, nearly double Pan Africa’s Sh5.3 billion.
CIC Insurance has hired former Pan Africa Holdings CEO Tom Gitogo to understudy chief executive Nelson Kuria whose current contract ends in 2016.
Mr Gitogo, who resigned from Pan Africa last week after six years at the helm, will hold the position of deputy Group chief executive before the expected retirement of Mr Kuria.
“This appointment is part of the succession planning for the group chief executive,” said CIC Group chairman Japheth Magomere in a statement.
Mr Gitogo will head CIC’s Kenyan unit and later take up the company’s regional business — spanning several countries — from Mr Kuria.
“I like their East African strategy. The potential they have through the co-operative movement is exciting,” he said in an interview on his new role at CIC.
Mr Gitogo will be inheriting a bigger operation at CIC relative to Pan Africa. CIC collected Sh11 billion in gross premiums last year, nearly double Pan Africa’s Sh5.3 billion.
Pan Africa, however, posted a better financial performance, doubling its net profit to Sh1.2 billion as it booked major gains in its equities portfolio.
CIC’s net earnings remained flat at Sh1.4 billion as claims rose 30 per cent to Sh6 billion. CIC’s presence in the life and general insurance business gives it a more diversified operation compared to Pan Africa which focuses on the life business.
Mr Kuria has been chief executive of CIC since 2001, having risen from a three-year stint as the company’s business development manager.
He has been the face of the company that has ridden on the cooperative movement to fuel growth, providing it with a strong base of shareholders and customers.
The outgoing CEO is himself a shareholder in the company, holding 12.5 million shares currently worth Sh105.1 million.
His impending exit comes at a time when the company is in the middle of a regional expansion plan, a strategy that Mr Gitogo is expected to follow.
The company has signed a joint venture deal with Malawi Union of Savings and Credit Co-operatives to start an insurance firm in the country. CIC’s capital contribution to the startup stands at Sh300 million, giving it a 49 per cent stake.
The company is also eyeing joint ventures with local investors to launch operations in Uganda and South Sudan in the near term.
It has allocated Sh500 million for the South Sudan venture where it will take a 69 per cent stake while Co-operative Bank’s subsidiary in that market takes the remaining 31 per cent.
CIC will invest Sh300 million to acquire a 51 per cent stake in a new subsidiary in Uganda with the remaining 49 per cent equity to be held by Uganda Cooperative Savings and Credit Union Limited.
The Malawi and Uganda units are expected to start operations by year-end. Mr Kuria says the firm has stepped up its regional expansion to grow its earnings and diversify from the Kenyan market.
All the countries CIC is targeting have a low insurance uptake, close to that of Kenya standing at about 3.5 per cent.
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