By Linda Kwanjana
United General Insurance (UGI) Chief Executive Officer Grant Mwenechanya says the insurance firm has set a clear and deliberate turn-around strategy focused on revenue growth, systems improvement, disciplined risk management, and long-term sustainability.
This follows a turnaround from a K653 million loss before tax in 2023 into a K3.0 billion profit before tax in 2024 according to financial statements the insurance company has released.
Mwenechanya said in an interview that the turn-around was made possible by the clean-up strategy focused on rebuilding the company’s foundation.
He said the company had been grappling with slow revenue growth, averaging just 8%, well below inflation, alongside rising claims, outdated IT systems, and a debtors’ book with payments outstanding for over 365 days.
“We had to make tough decisions in 2023, it was the year we addressed our weak spots, revamping claims management, upgrading our systems, and bringing our debtors under control. We did the groundwork so the business could recover properly,” said Mwenechanya.
Mwenechanya said by the end of 2023, revenue had grown by 25%, and the company had reduced outstanding debtors from over a year to under 90 days, marking a significant operational shift.
“The results of that clean-up became clear in 2024. Insurance revenue increased by 33%, claims dropped by 26%, and receivables were managed efficiently, with 100% of debtors brought within 30 days. UGI closed the year with a profit before tax of K3.0 billion, its strongest in recent years.”
“This turn-around did not happen by chance; it was a direct result of the structure and discipline we put in place. Everyone on the team worked hard and stayed focused,” said Mwenechanya.
As a subsidiary of National Bank of Malawi (NBM) plc, Mwenechanya also acknowledged the critical role played by NBM plc, in strengthening governance and enabling recovery.
“Being part of a highly regulated and respected financial group like NBM plc has its advantages. Our shareholders offered strong strategic guidance and provided capital support when we needed it. That backing helped create a strong and stable working environment,” he said.
Financial expert, Richard Tembo commended UGI for the remarkable turn-around strategy considering the turbulent economic challenges that Malawi faced in 2024, including the El Niño-induced climate shock that severely affected agricultural output, and rising inflation which closed the year at an average of 32.2%.
“The reversal in insurance service results—from a loss of K2.2 billion in 2023 to a positive K1.85 billion in 2024 suggests that UGI not only brought in more business but did so with underwriting discipline and improved claims management. Gains were also made in the investment income mainly due to the favourable returns in the money market,” said Tembo
