CEO's Message

Nyaradzo CEO - Philip MataranyikaGroup Chief Executive Officer Philip Mataranyika
It's about trust and utmost good faith.

The Nyaradzo Group started operating in 2001 and just a few months into our existence the macro economic situation in the country started to deteriorate. The operating environment was tough marked with price increases, basic commodity and foreign currency shortages. For those who remember, that was the period of the Land Reform Program after the no vote on the new constitution referendum in the year 2000. As a new kid on the block, we were excited and went all out selling policies despite having little experience in the industry. It was difficult for us as a new entrant in a market dominated by giants. However, we still managed to register reasonable growth with a good number of customers signing up. Unfortunately for us as a new and young organisation, planning became difficult as the prices of goods and services kept going up.

To counter the macro economic induced deficit, we had at inception structured our products to include what we called a Premium Update Facility (PUF). PUF was a mechanism that allowed us to adjust premiums on our policies annually. It worked reasonably well in the early years until we hit hyper-inflation territory a few years later. By 2007 not many products or services were available in Zim$ including fuel for our hearses and buses yet we continued to receive our revenue in Zim$.

Things came to a head in 2008 when all Zim$ transactions just stopped. Where before, there had been massive hyper-inflation induced price hikes over the years, suppliers suddenly stopped the supply of anything in Zim$ choosing instead to keep their stock or sell in US$. It became a herculean task, almost impossible for us to keep our promise to clients who had paid and continued to pay us Zim$ premiums that got eroded to nothing even before the ink on the client receipt was dry. At this time no-one was accepting Zim$ for goods and services, however, our revenue of premiums remained in Zim$ as most of our clients' salaries were in Zim$.

On one side we got paid billions if not trillions of Zim$, on the other, there was no one now accepting the same currency for the services due to our customers as per our signed contracts. All service providers were now demanding payment in US$ or the goods or services were not for sale.

In the face of all this, we chose to uphold our commitment and met our obligations to our clients, observing the cardinal rule of insurance, 'utmost good faith'.

We started disposing of some of the assets we had acquired in our short seven years of existence to cover the service provision gap. Asset disposal and other survival strategies we employed, made it possible for us to continue to honour our commitments to customers, providing them with coffins, caskets, hearses, buses and everything else as defined in the contracts they had with us. We made sure that not one customer walked out of our premises without getting the promised service as per contract when it would have been easier to ask them to walk citing hyper-inflation induced loss of value.

One may want to ask why we did what we did even when we knew we were losing millions of dollars honouring our contract with clients, the answer is in our DNA, 'Contracts must be respected'.

Besides, companies are created to exist into perpetuity while individuals live only for a limited time. A loss to an individual is real and final while the loss to an organisation or company, real or imagined can be recovered with time.
Individuals are in a short sprint race while companies are in long marathon runs with ups and downs along the way. Hyper-inflationary periods are phases in a long marathon run that are certainly painful but not insurmountable.

We believe that the bond which was forged between us and our clients, during the last hyper-inflationary period is unbreakable, following what we did to handle it. We showed every one of our clients and anyone who cares, the human face of our organisation despite the many challenges we faced. In return, we saw customers come out in their numbers to support and sign up with us when the economic environment became stable. They crowned our moment, now it's our turn to crown theirs. Don't they say one good turn deserves another?

We are not sure about how long the current phase of uncertainty now gripping our country will last, but like what happened in the past, it definitely will come to pass. This maybe another uphill stretch in our long marathon run as an organisation but like we did then, we commit again now, to ensure that our customers whose premiums are up to date will at no time be denied service.

In 2008 we were inexperienced and less prepared but we survived, thrived even and honoured each and every contract we had with our customers. It's good business honouring contracts. Unlike then, this new phase finds us in a very strong and robust position, well prepared and equipped to stand with our customers in these turbulent times.

We are about Service; we have built Strength and will continue to provide our customers with Solutions.

I usually joke with my colleagues in the industry saying that we transformed assurance policies from being a hard sell to now being sought after products- it's about trust.

Often we get requests from clients wanting service from us when their policies have been in a state of lapse for months or even years only to be hurriedly paid when they have a bereavement. In some cases clients realise the person covered is on their death bed while premiums are in arrears and they then frantically try to make amends by paying all premiums just before the person passes on. In insurance terms, this is called negative selection and unfortunately we have had to decline a good number of them because they wouldn’t have met their side of the bargain which is that premiums due must be paid on time.

In these very difficult times, the last thing anyone wants is to be faced with a huge bill for giving a loved one a decent sent off when the same bill could be covered by a valid and reliable funeral assurance policy.

We at Nyaradzo encourage that insurance contracts especially funeral policies be kept up to date not only in good times but at all times including hyper-inflationary periods, as we never know the day we or that special someone we love may breathe their last. This will ensure that when that day arrives Sahwira Mukuru will live up to our service commitment regardless of the macro economic conditions.

The stable dollarized environment post 2008 helped us to grow and invest in assets that now buttress as well as enhance our ability to serve our customers. Over the years we have grown to become the second largest life office in the land. On the funeral services and events management side, we are the largest company in the country by a long shot, thanks to our loyal customers.

Looking back, we are proud to have been one of the few insurance companies that stood with our customers during the hyper-inflation period. Going forward, our customers can find peace and comfort in the knowledge that we promise once again to stand with them through this season as a true Sahwira Mukuru does.