Ten insurance companies listed on the Nigerian Exchange Limited generated about ₦493.41bn in revenue in the 2024 financial year.
The PUNCH analysis of their unaudited and audited financial statements filed with the NGX indicated that it is about 65.53 per cent higher than the insurance firms did in the previous year.
The insurance firms included in this analysis are Cornerstone Insurance, AXA Mansard Insurance Plc, AIICO Insurance Plc, Sovereign Trust Insurance, Regency Alliance, Coronation Insurance, NEM Insurance, International Energy Insurance, Guinea Insurance Plc, and SUNU Assurances.
In the review period, the firms also raked in about N105.12bn in profit, about 73.69 per cent appreciation over ₦60.52bn from 2023, indicating that the insurance firms had had a good year despite the macroeconomic headwinds of 2024.
A closer look at the financial statements revealed that Cornerstone Insurance nearly doubled its profit after tax to ₦22.66bn from ₦14.05bn, marking a 61.28 per cent increase. Its revenue also rose to ₦38.45bn from ₦25.91bn.
The Managing Director/Chief Executive Officer of Cornerstone Insurance Plc, Stephen Alangbo, had, during a media chat in 2024, projected that the company was going to surpass its 2023 performance, saying, “We have recorded remarkable achievements in the last year, and we will continue to ensure continuous improvement. Our 2023 financial account was very good, and in the next year, I’m expecting an unprecedented result.”
AXA Mansard, in its audited financial statement, recorded a 58.71 per cent increase in revenue to ₦131.34bn from N82.75bn. Although insurance services expenses and net expenses from reinsurance contracts held impacted net insurance services results to ₦12.83bn, other investment revenue of ₦27.09bn offered a buffer, which helped the company to return a profit after tax of ₦26.19bn, which is more than double the ₦12.05bn from the previous year.
AIICO Insurance Plc grew its insurance revenue by 48.80 per cent to ₦108.27bn from ₦72.76bn, and its profit after tax rose by 12.19 per cent to ₦13.62bn.
The revenue of Sovereign Trust Insurance Plc hit N38.37bn from ₦19.32bn, marking a 98.58 per cent increase. Expectedly, its PAT rose by 142.34 per cent to ₦3.09bn from 1.27bn. Within the year, the firm’s insurance service expense rose by 191 per cent as net expenses from the reinsurance contract held appreciated by 41 per cent to impact the insurance service result, which stood at ₦4.84bn, 45 per cent higher than ₦3.33bn in 2023.
Coronation Insurance’s revenue rose by 98.89 per cent to N48.86bn, while PAT stood at N9.90bn, which is 444.43 per cent higher than N1.82bn. Coronation’s PAT was helped by the net investment income, which rose to N7.72bn from N2.47bn.
NEM Insurance saw its revenue grow by 86.77 per cent to N51.99bn from N45.12bn while its profit after tax hit N23.31bn from N13.25bn, marking a 75.90 per cent rise.
For International Energy Insurance, revenue stood at N5.55bn, which is 103.50 per cent higher than N2.73bn. Its profit after tax was N1.78bn from N850.66m in 2023.
SUNU Assurances’ revenue rose by 55.58 per cent to N15.35bn at the end of 2024, and its profit appreciated by 36.84 per cent to N3.67bn.
Both Regency Alliance Insurance Plc and Guinea Insurance Plc suffered a decline in their profits for the year to N758.97m and N147.58m, indicating 60.69 per cent and 69.11 per dips, respectively.
However, these companies managed to grow their insurance revenue by 19.47 per cent and 36.59 per cent to ₦7.27bn and ₦2.84bn.
Rating firm Agusto & Co., in its 2024 Insurance Industry Report, posited that the Nigerian insurance industry continued to show resilience despite the macroeconomic downturn, maintaining its growth trajectory.
“The industry has benefitted from the general drive to reprice premium rates upwards and the persistent naira devaluation as foreign currency-denominated premiums are bloated upon translation to naira,” stated Agusto & Co.
The firm said the outlook for gross premiums and performance is positive “given our expectation that the industry will continue to benefit from the free fall of the naira and the business expansion drive.”
Analysts have also said that enforcement of third-party motor insurance by the police will boost insurance penetration and, by extension, the revenue of players in the sector.
The President/Chairman, Governing Board, Nigerian Council of Registered Insurance Brokers, Bàbàtunde Oguntade, speaking at a recent event, said, “The IGP is for the federation, and when he gives an instruction, it goes to the commissioners.
They have an investment in the area and others, like mortgages and microfinance banks. I’m sure this NPF will not fail because they will ensure that they drive the market, and you know NPF cannot eat everything. The principle of insurance is in the sharing, so this industry will benefit from whatever initiatives the IGP is thinking of. Third-party insurance is a national thing, and it’s even cross-border now because it has the ECOWAS element there. If people really knew the benefit of what N15,000 was doing for them, nobody would need to chase them. I’m sure we are going to have improvements in that area.”
The enforcement commenced nationwide on Feb 1.
Credit: punchng.com
