The Treasury Registrar (TR) Office in Tanzania has initiated a sweeping reform movement within public entities across the country, and NIC Insurance has emerged as a shining example of how cultural change can catalyze profitability, efficiency, and productivity. Since instituting robust reforms in 2019, NIC Insurance has established itself as a benchmark in the insurance sector, capturing a substantial 16% market share and maintaining an impressive annual capital growth rate of 18%.
These transformative reforms have catapulted NIC's pre-tax profit from 33.65 billion Tanzanian Shillings in the fiscal year 2019/2020 to a staggering 63.21 billion Tanzanian Shillings in 2021/2022, marking a remarkable 43.91% increase. Furthermore, by June 2022, NIC had accumulated a profit of 45.74 billion Tanzanian Shillings, a significant turnaround from a loss accumulation of 19.31 billion Tanzanian Shillings in June 2020. This remarkable financial revival has enabled NIC to settle a long-standing debt of 73 billion Tanzanian Shillings, which had been lingering since its establishment in 1963.
Speaking at a press conference in Dar es Salaam on Monday, NIC Insurance Managing Director, Dr. Elirehema Doriye, elaborated on the transformation journey that began with the appointment of effective, professional leaders and a strategic focus on human resources, recruiting qualified, professional, and innovative personnel.Dr. Doriye noted, "It all started in 2019 when the government officially decided against privatizing the entity. We had to infuse new vigor into NIC's operations, emphasizing competitiveness and a culture change. We shifted from a business-as-usual mentality to a performance-oriented approach guided by key performance indicators (KPIs)."
He further explained that these reforms were complemented by a revised strategic plan, reflecting the company's shift toward a purely business-oriented model. "Now, business is at the core of everything we do. We've also heavily invested in information communication technology (ICT) to ensure accurate customer records," he added.Investments in digital transformation have not only boosted income by 13% but also reduced the time required to process clients' claims from 35 days to just 7 days.Dr. Doriye underscored the importance of well-defined claims settlement procedures, centered on fraud prevention, the implementation of a quality management system (QMS), and a brand revitalization campaign that has improved NIC's image, earning the company the prestigious Superbrand recognition.
He stated, "We focused on enhancing efficiency by plugging financial loss loopholes, prioritizing claims settlement, and upholding professionalism to ensure every employee delivers top-quality services to our clients." Through these reforms, the company successfully eliminated losses, increasing income from 76.45 billion Tanzanian Shillings in 2019/20 to 103.94 billion Tanzanian Shillings in 2021/22, marking a robust 17.98% increase. Dr. Doriye proudly highlighted NIC's achievement in clearing all outstanding debts, including the 9 billion Tanzanian Shillings owed to life insurance clients since 1994, many of whom are teachers.
Over the past three years, NIC's assets have steadily grown, reaching 423.99 billion Tanzanian Shillings in 2021/2022, reflecting a commendable 10.51% increase. The company's tax contributions to the government have also increased significantly, rising from 11.86 billion Tanzanian Shillings in 2019/2020 to 15.14 billion Tanzanian Shillings in 2021/2022, averaging a 13.80% yearly rise.Operational efficiency has played a pivotal role in the surge of shareholders' capital from 72.16 billion Tanzanian Shillings in 2019/20 to an impressive 217.07 billion Tanzanian Shillings in 2021/22, marking a remarkable 100.40% annual increase.
Lastly, Dr. Doriye noted that investments in government bonds for 2021/22 reached 105.64 billion Tanzanian Shillings, compared to the 51.58 billion Tanzanian Shillings in 2019/20, signifying an average yearly increase of 52.40%. Additionally, investments in bank deposits in 2021/22 grew to 32.23 billion Tanzanian Shillings, up from 19.53 billion Tanzanian Shillings in 2019/20, reflecting a substantial 32.54% increase.
In a significant show of financial stability and success, NIC Insurance paid a dividend of 2 billion Tanzanian Shillings to the government in 2022, a substantial increase from the 1.5 billion Tanzanian Shillings paid in 2021, marking the first dividend distribution in 30 years.
NIC Insurance's remarkable turnaround serves as a compelling testament to the power of cultural change and strategic reform in the public sector, setting new standards for efficiency and profitability.