A conversation with The Guardian on how operators can increase their profit at each of their financial year, the Managing Director, Law Union & Rock Insurance Plc, Ademayowa Adeduro, in an interview with I over the weekend said the underwriter posted a 254.43 per cent increase in profit after tax in its 2019 financial year end, rising from N226.5 million in 2018, to N802.8 million. A reflection of efficiency in asset utilization and management cost control.
While gross written premium grew to N4.82 billion from N4.54 billion in 2018, representing a 6.34 percent increase in top-line performance for the period. Total assets grew by 8.35 percent from 11.2 billion in 2018 to 12.1 billion in 2019.
Adeduro stressed that shareholders fund and underwriting result both recorded double digit growth from N6.4 billion to N7.2 billion and from N638.2 million to N982.9 million; representing 12.3 and 54.01 percent growth respectively.
He explained that the underwriter maintains a healthy solvency margin of 206 percent, exceeding the regulatory statutory solvency margin of 100% and above industry average of about 125 percent.
On the other hand, Underwriting expenses decreased by 4.14 percent from N2.52 billion to N2.41 billion while Management Expense increased by 6.6 percent, from N1.3 billion to N1.4 billion. Net Claims Expenses reduced by almost 20 percent, indicating that the company was able to write more profitable business, despite average claims costs rising in the industry.
The analysis in the industry showed that the company achieved seven percent growth on the return on assets, translating to N936.17 million recorded in 2019.
There was also 11 percent growth on return on equity while more than 100 percent of the company’s written premium was earned.
One of the policy-holders in the industry that commented on the result said that the firm’s assured investors of its 2019 financial results, despite the challenging operating environment.