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Chuks Udo Okonta
Law Union & Rock Insurance Plc, one of the leading underwriting firms in the country has witnessed impressive growth in key indices of its 2019 financial account and here is an analysis of those figures.
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.
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.
Further, 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.
The company maintains a healthy solvency margin of 206 percent, exceeding NAICOM’s statutory solvency margin of 100% and far 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.
Further analysis 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.
Commenting on the result, the Managing Director, Ademayowa Adeduro said the company was pleased with its 2019 financial year end results, despite the challenging operating environment. However, they intend to do better, as the year started well, with Q1 and Q2 recording double digit growth Q-on-Q. It is to put this same level of performance into the following quarters to ensure commensurate growth all year round.
According to him, these are all good indices showing the company is healthy and growing.