Just before the third quarter of 2020 closed, quoted insurers despatched an avalanche of forecasts to the Nigerian Stock Exchange, streaming enamoured good performance for Q4 in a year when Covid-19 forced the world to graduated economic decline, with a few flash points flagging emerging promising performance.
The insurance industry was represented in the flash points where it was not all news of over powering pandemic, but also there were some, flying high above the vicissitudes of the pandemic.
The insurance operators speaking from what was then a forecast, and now a performance cast in iron, were now moving in a separate way that was insulated from the harsh stretches in the economy. Without exception, all the results sent to the NSE up and until today, Thursday, February 4, 2021, reflect and tell the story of good Q4 performance. The results might not capture all the anticipated outcome for the quarter, but it leaped over with record performance.
Stock brokers then, were not surprised at high volume of forecast indicating that something was about to happen, but were concerned about the economy that was technically in recession after two consecutive quarters reported drop in gross domestic product (GDP). Mr. Charles Fakrogba, a high calibre broker and former chief relationship officer, TFS Securities & Investment, said the forecast might be at variance with the economy, the insurance companies “are very resilient… they have put in all that they know in their operations.”
Another stock broker, CEO Trust & Investment Company Limited, Mr. David Imafidon Adonri, shared same platform with insurers forecasts, explaining that the pandemic and the lockdown did not disrupt operations, remote working was switched on and, it has been so up and until now.
Investment gains was another hallmark for the good forecast, “that is why most of the insurance companies continue to declare profits.” He also said that the bullish run has served as good lane for smooth glide for insurers to brace the profit tape when the fourth quarter curtain drops. They did eventually.
It has turned as the operators has worked it out. NEM Insurance Plc, unaudited Q4 despatch to NSE showed that the profit after tax for last quarter 2020, was N2.96bn, up from N663.3m in the last quarter of 2019, a 347% increase.
Its gross premium written dropped slightly to N3.26bn in Q4 from N3.55bn in same period for 2019. However, the full profit for 2020 rose by 71.72% from N2.37bn to N4.08bn.
In the same vein, Sovereign Trust Insurance Plc, unaudited performance recorded 48% rise in profit after tax, it closed at N746,29m as against N503.38m. The general insurer increased its gross premium written to N1.12bn from N10.88bn, a slight two percent increase.
The managing director, Mr. Olaotan Soyinka, while reflecting on the 2019 performance, attributed the performance to the commitment shown by every member of staff who he described as the drivers of the organisation coupled with the fact that the company management is also dedicated to ensuring that the company takes its place of pride in the industry.
Also counting is Linkage Assurance Plc, its profit after tax for the last quarter 2020 moved from N1.45bn to N1.94bn, registering 34% increase. The year’s total for the unaudited profit after tax moved up to N2.54bn from N1.33bn, an increase of 90% over the previous year.
Impressing on the NSE that the result will continue in the first quarter of 2021, Linkage stated: “We will continue to refine our strategy in line with the political, economic, sociological and technological changes in the industry particularly the impact of Covid-19 pandemic on the business landscape. We will also continue to develop innovative products, alternative channels of distributions and strategic initiatives that will enable us achieve our corporate goals and objectives.”
Also included is AXA Mansard Insurance, closing the 2020 unaudited results with gross written premium of N47.58bn from previous year mark of N43.62bn. The profit for the year moved up by 47.7% to N4.29bn from N2.90bn.
The underwriter in its forecast for first quarter of 2021 presented to NSE, stated that it planned to achieve 14% growth, that will earn N24.09bn more than its figure for 2020 which was N21.08bn. Its also expecting a 12% rise in profit after tax, this will raise it to N2.04bn from the previous N1.82bn.
The forecast projects a drop in cash/bank balances at the end of the period to N6.84bn from N17.91bn at the beginning.
The streak of good performance was also registered on Cornerstone Insurance Plc. Its gross premium written for the year was N17.59bn 34% more than N13.05bn made the previous year.
The company’s profit however, dropped from N4.10bn to N1.59bn, a decline of 61.14%.
Also in the channel of good performance is SUNU Assurance which recorded N4.2bn at the end of Q4 up from N3.06bn the previous year. Its profit was N301.03m from the loss of N225.26m in 2019.
SUNU underwriting profit increased from N781m to N1.22bn, a growth of 562% due to technical efficiency in business operations.
