Leadway Assurance gross premium hits N22.4 b

Leadway Assurance gross premium hits N22.4 b

Pays N5.7 kobo dividend

 Chuks Udo Okonta

 Leadway Assurance Company Limited has said it recorded gross earnings of N22.4 billion, last year,  a 21.75 percent increase from N18.4 billion in 2010. Gross written premium also increased by 38 percent to N19.6 billion from N14.2 billion the previous year. This amount of premium is currently the highest volume generated by a single insurance company in Nigeria, which the company explained has been largely driven by revenue sources from its commercial/industrial lines of business. 

But with huge reinsurance cost, which went up by 29 percent from N7 billion in 2010 to N9 billion at the end of 2011, the company’s net premium earned closed at N10 billion as against N8.6 billion in 2010, a 16 percent rise. According to the financial statement, the performance was further eroded by a significant increase in claims incurred which rose by 129 percent from N2.4 billion in the previous year to N5.5 billion in 2011. This amount is also currently the largest volume of claims recorded by a single insurance company in Nigeria, thus reflecting its commitment to meeting customer/public expectation of insurance obligations. “The significant rise in claims incurred affected the underwriting profit, which dropped by 19 percent from N4.3 billion to N3.5 billion in 2011, with overall 24 percent drop in company profit before tax of N1.55 billion, down from N2.03 billion in 2010 while the profit after tax dropped by 49 percent to close at N1.04

billion in 2011. The profit position of the company was enhanced by investment income, which appreciated by 38 percent, moving from N1.3 billion in 2010 to N1.79 billion in the review year. The company’s balance sheet size grew by 9 percent from N39 billion in 2010 to N42.5 billion in 2011, with the value of insurance fund rising  by 55 percent from N11 billion in 2010 to N17 billion in the review year, while still due to the lull in the capital markets, shareholders fund closed at N11 billion.

The statements further revealed that with economic /infrastructural reforms, the potential for growth exists and the company is well positioned to take advantage of the insurance value chain. According to its Chairman’s statement, “the company is positioned to benefit from the National Insurance Commission (NAICOM) Market Development and Restructuring Initiative (MDRI) by increasing the level of awareness needed to deepen insurance penetration in Nigeria through mass awareness campaigns and other programmes for the sale of compulsory insurances”. 

Meanwhile, the company declared N500 million dividend, which translates to 5.7 kobo per share of the company