AIICO Boosts GWP by 12.2% as Profit Dips 17.6% in Q1’21

Image

By Adedapo Adesanya

Leading insurance company, AIICO Insurance Plc, recorded a 12.2 per cent growth in its Gross Written Premium (GWP) to N19.7 billion in the first quarter of 2021 from N17.6 billion recorded in the corresponding quarter of 2020.

According to the company, the increase was due to a year-on-year rise of 34.0 per cent in the general insurance business (35.7 per cent of gross written premiums) to N7.0 billion as against N4.6 billion recorded in Q1 2020.

However, the profit after tax declined by 17.6 per cent year-on-year to N1.5 billion in the first quarter of 2021 from N1.9 billion in the first three months of last year.

It was observed that the profit before tax increased by 11.3 per cent year-on-year to N1.6 billion in Q1 2021 from N1.4 billion in Q1 2020 on the back of improved overall profitability in the insurance businesses (Life, General and HMO).

AIICO revealed that it recorded an underwriting profit of N27.7 billion in Q1 2021 compared to the N131.0 million loss posted in Q1, noting that it was attached to changes in sovereign bond yields, which impacted the value of the company’s liabilities and assets.

In the life business, the firm explained that it was typically concerned about whether there is a surplus or deficit of assets over liabilities because of these movements. However, because of limitations in financial reporting, changes in liabilities affect underwriting profits while changes in assets are reported below underwriting profits.

“The effect is the significant variation in underwriting profits especially in volatile investment yield environments, such as we have in Nigeria. During Q1 2021, annualized yields rose by 430 basis points to 11.7 per cent at the long end of the yield curve, leading to a reduction in the fair values of assets and liabilities; the reduction in liabilities led to positive underwriting profit while the reduction in assets is reflected in the fair value losses for the period,” it said.

According to the firm, the total investment income declined to a loss of N24.1 billion in Q1 2021 compared to N4.7 billion in the same period of last year. This came as the federal government’s bond yields rose, affecting the fair value of the company’s financial assets. FGN bonds make up most of AIICO’s investment portfolio.

It was revealed that profits in its wealth management business declined in Q1 2021 as capital markets turned bearish during the quarter.

Total assets declined by 11.1 per cent to N216.2 billion in Q1 2021 as against N243.1 billion in the preceding year driven by a reduction in financial assets (-9.3 per cent; 79.0 per cent of total assets) and cash and cash equivalents (-38.2 per cent; 9.1 per cent of total assets).

Total liabilities declined by 13.4 per cent to N180.6 billion in the review period as against N208.4 billion recorded in the full year 2020. This was driven mainly by a decline in insurance contract liabilities (-15.9 per cent) from the rise in yields and reserving for new business and fixed income liabilities (-9.5 per cent) in its asset management business.

Total equity increased by 2.8 per cent to N35.6 billion in Q1 2021 from N34.7 billion recorded in the whole of 2020.

Commenting on the results, the Managing Director and Chief Executive Officer (CEO), Mr Babatunde Fajemirokun, said, “The world is in a difficult moment and Nigeria has not been spared.

“Even as the world starts to move on from the pandemic, the economic after-effects will reverberate for a while yet. However, there is some reason for optimism – economic activities have improved, and the country will likely exit the recession. Oil prices remain elevated, and the pandemic-induced lockdowns are easing all over the world.

“We made significant strides in 2020: implementing our business continuity plan and leveraging technology to improve processes and get closer to our customers. Building on this, we recorded premium growth of 12.2 per cent year-on-year to N19.7 billion in Q1 2021. Our financial position remains resilient as well – shareholders’ funds increased 3.3 per cent year-to-date to N34.8 billion.

“Nonetheless, we remain optimistic that economic activities will continue to rebound in coming periods, the IMF has revised its economic growth forecasts for Nigeria upward to 2.5 per cent from 1.5 per cent.

“Insurance, like every other sector, will have its role to play in the economic recovery as enablers of economic growth by assuming risks that encourage long-term direct investment which enhances production and job creation. Our robust financial position ensures that we can meet our obligations when they arise.”

AIICO Insurance is a leading composite insurer in Nigeria with a record of serving our customers that dates back over 50 years. Founded in 1963, AIICO provides life and health insurance, general insurance and investment management services to create and protect wealth for individuals, families and corporate customers.

Share
Related Stories
Image
26-February-2024

Yields to Remain High for Money Market Investors in Nigeria

By Aduragbemi Omiyale Money market investors in Nigeria have been assured that despite the current economic challenges, yields will remain high this year. According to analysts at FBNQuest, this would be supported by the resolve of the Central Bank of Nigeria (CBN) to sustain tight monetary policy amid inflationary pressure and the foreign exchange (FX) liquidity crisis. The National Bureau of Statistics (NBS) recently said inflation for last month increased by 29.90 per cent on the back of aggravated food prices. A few weeks ago, the central bank raised the stop rates of treasury bills to 19 per cent in

Image
27-February-2024

Nestle, Fidson, Others Pull Down Stock Exchange by 0.09%

By Dipo Olowookere The Nigerian Exchange (NGX) Limited was pulled down by 0.09 per cent by Nestle Nigeria, Fidson, Access Holdings, UBA, and 20 others on Monday due to mild profit-taking. Investors trimmed their exposure to equities in a bid to diversify and try money market instruments, which are giving higher yields amid rising inflation in the country. They also sold off the shares ahead of the interest rate-setting announcement on Tuesday by the Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN). The selling pressure cut off 92.77 points from the All-Share Index (ASI) to 101,995.53 points

Image
28-February-2024

Senate Advocates Introduction of Food Stamps in Nigeria

By Adedapo Adesanya The Senate has urged the federal government to introduce the Nigerian version of the “food stamps programme” as an interim intervention to cushion the effects of food shortages in the country. This followed the adoption of a motion on the Introduction of Food Stamps in Nigeria as an Interim Measure to Address Imminent Food Insecurity in the country, by Mr Ali Ndume, the Senate Chief Whip at plenary on Tuesday. Presenting the motion, Mr Ndume said that in other countries, like the United States, food stamps were government-issued coupons that had been in use since 1939. “This is

More Stories
Image
31-July-2020

Protein Deficiency: A Blight On Modern Healthcare

By Reginald Onabu Modern medicine has made giant strides in the last 50 years. There has been appreciable progress in the evolution of healthcare and contemporary medical science. Today, the world is a much better place, in that regard. New technologies and research are helping to produce drugs and medicines to improve treatments, cures and solutions. Several illnesses and diseases that were formerly thought to be incurable such as poliomyelitis, arthritis and bronchitis, are now almost treatable, or at least better managed. Advances in modern medicine have developed to the point where doctors can perform virtual surgeries in different locations

Image
18-January-2017

10,000 Students Apply for Transfer in Lagos

By Modupe Gbadeyanka Permanent Secretary in the Lagos State Ministry of Education, Mr Adesina Odeyemi, has disclosed that over 10,000 applications were received for transfer to public schools in the state in the current academic session. Mr Odeyemi made this known in the Conference Room of the Ministry during an interactive session with some parents and students led by Mrs Ramota Shamsideen who were on a visit to inquire why the transfer request of their wards were not effected. The Permanent Secretary explained that until all renovation and reconstruction is completed in schools in order to make the environment conducive

Image
08-January-2021

Nigeria, Benin, Niger Establish Joint Border Patrol

By Adedapo Adesanya Nigeria, the Benin Republic and the Niger Republic have set up a tripartite border patrol team that will check smuggling, irregular migration and other organised crimes committed across transnational lines as Nigeria begins the gradual opening of its land borders. This was disclosed in a statement signed by the Public Relations Officer of the Nigeria Customs Service (NCS), Mr Joseph Attah, on behalf of the Comptroller-General of Customs, Mr Hammed Ali, on Friday. It was explained that the alliance will see Nigeria’s Operation Swift Response (OSR), which was launched in August 2019 and coordinated by the Office

Image
13-October-2022

Nigeria’s Moni Africa, TouchandPay, Others Jostle for $50,000 Ecobank Fintech Prize

By Adedapo Adesanya Nigerian financial technology startups, Moni Africa and TouchandPay, have made the six finalists chosen to jostle for the top price of $50,000 and admission to the Ecobank Fintech Challenge Fellowship programme. Following extremely strong competition from over 700 fintechs from 59 countries, the two Nigerian startups will be at the grand finale on October 28 at the Ecobank Group Pan African Centre in Lomé, Togo. The companies are part of the finalists from the Democratic Republic of Congo, Nigeria, Senegal, South Africa and Togo. The others are Cauri Money from Senegal, DizzitUp from Togo, MaishaPay from the

Image
08-August-2018

Darkness Looms as NUEE Disrupts Activities at Ikeja Electric

By Olubori Oduntan Operations at the headquarters of Ikeja Electric Plc were shut down by some protesting members of the National Union of Electricity Employees (NUEE) on Wednesday morning. Business Post gathered that the demonstrating workers were picketing Ikeja Electric over the alleged disengagement of about 40 members of the union. Recall that last week, the electricity company announced the promotion of 299 personnel on its payroll, adding that in the past one year, it had recruited over 500 new employees into its workforce. According to Ikeja Electric, the promotion exercise cut across all cadres of staff, including members of

Image
22-September-2020

How to Redeem the VBank Promise

If you live in Nigeria, you’ve probably heard some stories about how difficult it is to get anything done at a government agency. Those stories are so popular that they have made their way into popular culture through oga is not on seat jokes. When you’re going to a government agency, you brace yourself for the reality that no matter how small the task you want to accomplish, it could take all day. It’s not unusual for simple processes to be complicated by ridiculous demands. It’s the sort of thing we’ve come to expect from Nigeria’s public sector. Yet, in

Image
03-August-2018

Aisha Buhari Seeks More Efforts to Prevent Spread of Cancer

By Dipo Olowookere Wife of the Nigeria’s President, Mrs Aisha Muhammadu Buhari, has called on stakeholders to engage more women in their effort to prevent the spread of cancer disease and the death of many. She made the call at the High-Level Regional Seminar on Cancer Awareness and Advocacy at Ouagadougou, Burkina Faso on Thursday, August 2, 2018. Mrs Buhari urged stakeholders to take advantage of decisions that will come out of the meeting and chart a clear course of action on cancer prevention. Like in many countries, she said, Cancer is a major health challenge confronting Nigeria as it

Image
13-June-2023

Understanding Technical Indicators: Tools for Analyzing Market Trends

Technical indicators are very effective instruments for analyzing market movements and making profitable trades. Potential entry and exit points in the market may be determined using these indicators based on past data like price, volume and open interest. Some of the most often used indicators include moving averages, Bollinger Bands, the Relative Strength Index, the Stochastic Oscillator, Fibonacci Retracements and the Moving Average Convergence Divergence. Moving averages help investors determine the underlying trend in a security’s price by removing the impact of temporary price changes. Bollinger Bands provide a measure of volatility by showing two standard deviations above and below

Ad
Ad
Recent Stories
Image
28-February-2024

Dangote Cement Wins Environmental Sustainability Award

By Aduragbemi Omiyale NatureNews has announced Dangote Cement Plc as the winner of the 2023 NatureNews Environmental Sustainability Award at its 3rd anniversary themed Climate Change and Energy Transition in Nigeria. At the Anniversary Lecture and Presentation of the Hero of Environmental Actions for Development (HEAD) held on Tuesday at the Shehu Musa Yar’Adua Centre, Abuja, the news platform said Dangote Cement was nominated for the category following a thorough screening by eminent professionals. The Publisher and Editor-in-Chief of NatureNews, Mr Aliyu Akoshile, disclosed that during the screening, it was discovered that the cement maker had deployed cutting-edge technology to

Image
28-February-2024

Nigeria’s Stock Market Stands Still to Honour Ogunbanjo’s Legacy

By Aduragbemi Omiyale The stock market in Nigeria stood still for the late former chairman of the Nigerian Exchange (NGX) Group Plc, Mr Abimbola Ogunbanjo, on Tuesday, February 27, 2024. The day was set aside to pay homage to the enduring legacy of the esteemed luminary, who died in a helicopter crash in the United States a few weeks ago along with the group chief executive of Access Holdings, Mr Herbert Wigwe, his wife and son. The NGX Group held an Afternoon of Tributes and Closing Gong Ceremony yesterday for him in collaboration with the Coronation Group. In a poignant

Image
28-February-2024

Fans Anticipate ‘Return of Maleeka (Atupa)’ by Mobolaji Samuel

By Modupe Gbadeyanka Some movie lovers are already calling on a movie producer in Nigeria, Ms Mobolaji Samuel, to release the sequel to her captivating film, Maleeka, Return of Meleeka (Atupa). The quest to see the second part of the flick is due to the exploits of the Nollywood filmmaker in the first part. However, she has called for calm, assuring her fans that the release date of her latest work of art would be announced very soon. Speaking recently on the Return of Maleeka (Atupa), the charming movie maker described the film as a story of faith and resilience,

Image
28-February-2024

FG Selects Learning Community Managers for 3MTT Initiative

By Modupe Gbadeyanka The federal government has selected Learning Community Managers for the 3MTT Initiative for all 36 states of the federation and the Federal Capital Territory (FCT). The managers were picked for the programme by the Federal Ministry of Communications, Innovation & Digital Economy, which is handling the initiative. Recall that the government secured N1 billion in partnership with IHS Nigeria to support the 3MTT Learning Community. The selection of Learning Community Managers marks a significant milestone in the government’s efforts to empower Nigeria’s tech talents. These individuals will play a crucial role in managing and assisting participants in

Image
28-February-2024

Renowned Embryologist Dr Marta Jansa Perez Visits Bridge Clinic Nigeria

By Modupe Gbadeyanka A renowned embryologist, Dr Marta Jansa Perez, has visited the Bridge Clinic Nigeria in Lagos, reinforcing its commitment to excellence in reproductive healthcare. Ms Perez is the Director of Embryology at Bridge Clinic London. Her visit to the Nigerian affiliate of the foremost healthcare organisation is a testament to the partnership between the two clinics, opening new avenues for the exchange of expertise and resources. The health practitioner arrived at Bridge Clinic Nigeria on Monday, February 19, 2024. Her week-long visit was meticulously structured around training, process and quality improvement, research and development, and guidance on best

Image
28-February-2024

Zero Routine Gas Flares and Delta Communities

By Jerome-Mario Utomi It is common knowledge that in pursuit of meeting the targets of 20 per cent (unconditional) and 47 per cent (conditional) greenhouse gas emission reduction as contained in the Nationally Determined Contribution under the Paris Accord reportedly signed by the President Bola Tinubu administration, the Nigerian National Petroleum Company Limited/TotalEnergies joint venture recently achieved zero routine gas flare in all its assets. While it is obvious that “the significance of this achievement is that the last routine flare volume of about 12MMscf/d (12 million standard cubic feet per day) of gas has now been eliminated giving rise

Image
28-February-2024

70 Active Stanbic IBTC Bank Customers Grab N7m in January Draws

By Aduragbemi Omiyale The sum of N7 million has been won by 70 active customers of Stanbic IBTC Bank in its ongoing Reward4Saving Promo. The money was won in the January 2024 draw, bringing the total number of beneficiaries since the inception of the promo in 2021 to 1,424 valued at N234 million, a statement from the company said. The Reward4Saving Promo was created to foster disciplined saving habits among Nigerians, offering them rewards for achieving specified savings targets. In the January draw, 10 winners were selected from each of the seven business regions operated by the bank in Nigeria,

Image
28-February-2024

Firms in Nigeria to Pay Annual Levy for Hiring Foreigners

By Aduragbemi Omiyale A new tax known as Expatriate Employment Levy (EEL) has been introduced by the federal government and it is to be paid by companies, which hire foreigners to work in Nigeria. The scheme was launched on Tuesday in Abuja by President Bola Tinubu and it is to close wage gaps between expatriates and Nigerian workers. The government explained that the policy aims to find a balance between leveraging foreign expertise and fostering local talent in Nigeria’s job market through the EEL, emphasising that it is not to discourage foreign investments. It was stressed that the level would

Image
28-February-2024

Senate Advocates Introduction of Food Stamps in Nigeria

By Adedapo Adesanya The Senate has urged the federal government to introduce the Nigerian version of the “food stamps programme” as an interim intervention to cushion the effects of food shortages in the country. This followed the adoption of a motion on the Introduction of Food Stamps in Nigeria as an Interim Measure to Address Imminent Food Insecurity in the country, by Mr Ali Ndume, the Senate Chief Whip at plenary on Tuesday. Presenting the motion, Mr Ndume said that in other countries, like the United States, food stamps were government-issued coupons that had been in use since 1939. “This is

Image
28-February-2024

Trucks Transit Parks Reflects Industry Impact, Future Opportunities

By Modupe Gbadeyanka A leading technology company specializing in mobility solutions, Trucks Transit Parks (TTP) Limited, is marking its third year of operations. As part of this, the firm is reflecting on the significant impact it has made in the maritime and logistics industry. TTP, since its inception to revolutionize the maritime and logistics sector in Nigeria through truck mobility solutions powered by technology, has emerged as a key player in driving port terminal efficiency, reducing traffic congestion, and creating new business opportunities within the Apapa port economic zone. “Our third anniversary of operations provides us an opportunity to reflect