CIC ventures into real estate with Sh2.8b housing plan in Kiambu

CIC Group will venture into real estate with a Sh2.8 billion commercial and residential development on its 200 acre parcel in Kiambu county.

The listed underwriter's chief executive Tom Gitogo said this was in line with the company’s plan to safeguard investor funds from the volatility of the financial markets where they had invested the bulk of their investor funds.

The GCEO was speaking in Nairobi during an investors’ briefing where he disclosed that the firm's net profit for the period ended December rose by 4.4 per cent to stand at Sh1.13 billion.

The mixed development will be launched mid this year after a property consultant currently on the ground completes work where CIC will largely put up high-end, medium and studio apartments targeting the entry level market on land located next to Tatu city.

Mr Gitogo said that premium undercutting in the insurance industry created an unhealthy environment to operate in and urged Kenyans to look at the benefits when deciding on what policies to buy and not the cost of premiums.

The CIC boss added that gross premium for the 2015 period under review decreased to Sh 11.4 billion compared to Sh 13.7 billion in 2014, which was blamed on relieving CIC of nine of its key clients who paid handsome premiums but also made the company incur heavy losses from numerous claims made.

He said CIUC Group welcomed the planned risk based supervision framework under review by Insurance Regulatory Authority (IRA) against the current system where insurance companies only had to meet a specific minimal capitalization to be licensed.

“In future we shall have to be rated based on the amount of risks insured versus capital. We have capitalized and we shall not need to seek a cash injection to meet the new IRA requirement,” he said.

On the Uganda, Malawi and South Sudan subsidiaries, Mr Gitogo said they were still investing in them, adding that the firm expected to enjoy handsome returns of up to 40 per cent profit from the three units as well as from the stake in Takaful Insurance.

The insurance group, which enjoys a 1.3 million customer base, said it would capitalize on its sacco and co-operative movement distribution network to grow its new business especially on crop and livestock insurance.

CIC Group comprises of three locally registered companies, CIC Life Assurance, CIC General Insurance Limited and CIC Asset Management with a nationwide 25-strong branch network and 1,000 financial advisors.