Law Union and Rock Insurance Plc has posted a profit after tax of N280 million for the year ended December 31, 2015, compared to the N125 million it recorded in 2014.
This was made known by Princess Adenike Adeniran, who resigned as the Chairman of the company at its 47th Annual General Meeting (AGM).
According to her, the underwriting profit for the financial year stood at N1.144 billion from N1.034 billion in 2014, representing an increase of 10.6 per cent.
She stated that gross premium written for 2015 decreased by seven per cent from N4.161 billion achieved in 2014 to N3.858 billion, but net premium recorded an increase by 7 per cent to N2.692 billion in 2015 from N2.512 billion in 2014.
The increase in net premium was due to better earned premium ratio in both brought forward and the period under review.
She added that the investment income moved from N366 million to N489 million, reflecting our ability to generate both free float and high underwriting margins.
She said: “Despite the economic headwinds, the bottom line improved, the investment income was enhanced, while solvency and liquidity were higher than the prior year”.
“This was as a result of improvement in the investible fund of the company despite the unstable investment climate and depressed interest rate in 2015.”
“The profit before tax rose by 27 per cent from N259.8 million in 2014 to N328.5mn in 2015.”
“The increase came as a result of improvement in earned premium in the reporting period and 34 per cent increase in investment income despite seven per cent drop in gross premium written for the period under review.”
“Profit after tax reported for 2015 was N280 million compared to N125 million in 2014. The company said notwithstanding, shareholder funds increased by N276m from N4.182bn in 2014 to N4.458bn in 2015. The balance sheet remains robust, growing and more liquid.”
“The total Assets grew by 13.4 per cent from N7.29b in 2014 to N8.27b in 2015. The cash equivalent also grew by 19.2 per cent from N2.58b in 2014 to 3.08b in 2015.”
“Our cash and cash equivalents account for more than 60 per cent of our investment portfolios which are superior to the industry average.”
Speaking on the future outlook of the company, Princess Adeniran said the outlook for the industry is very positive and that of Law Union and Rock.
In order to deepen the transformation of our company, the Board is in search of foreign strategic investors for growth capital to improve product distribution, upgrade processes and platforms, and deepen our participation in oil and gas, power and transportation segments.
Managing Director, Jide Orimolade said great progress was made in 2015, as Law Union and Rock received a BBB+(NG) rating on Claims Paying Ability (CPA) by Global Credit Rating Co, a South African based credit rating bureau, confirming the company as one of the top insurance companies in the country on the ability to pay claims.
He noted that the Insurance sector in Nigeria currently contributes about 0.65 per cent to GDP.
“In other to increase its contribution to GDP the industry is tending towards developing alternative channels through innovation, building closer interaction with the informal sector operators, with intensive capacity building and nurturing of a greater expertise in micro insurance operations.
“The regulator has introduced new guidelines to restore sanity to insurance practice in the country and deter unprofessional behaviours among operators in the industry.”
“Also, the Federal Government has concluded plans to review the Insurance Consolidated-Bill in order to make it conform to the ideals of contemporary insurance practice and ensure an efficient insurance industry in the country. Few mergers and acquisitions were recorded in 2015 with most of the acquisition done by foreign companies,” he said.
