Rise In Claims Payment Cuts AIICO Insurance Plc Q1 Profit

AIICO Insurance Plc, on Thursday presented its performance score-card for the first quarter ended March 31, 2018, indicating that the percentage rise in net profit was slower than that of gross premium income, resulting in the N90.215m underwriting loss for the period.
Specifically, gross premium written rose by N3.659bn or 52% from N7.092bn to N10.751bn; while gross premium income climbed N1.964bn or 40% up to N6.926bn from the previous first quarter’s N4.961bn.
Reinsurance expenses grew to N1.168bn from N817.688m; following which net premium income stood at N5.757bn from N4.143bn, up by N1.613bn or 39%.
For fees and commission income, insurance contract jumped to N340.539m from N147.064m; while pension and other contracts dropped slightly to N451.442m from N483.614m; as net premium income climbed to N6.549bn from N4.774bn
Gross claims expenses climbed from N3.792bn to N6.934bn; and claims expenses recovered from reinsurer from N392.96m to N1.303bn; while claim expense (net) jumped 66% up from N3.399bn to N5.63bn.
Underwriting expenses of AIICO Insurance climbed to N1.909bn from N766.168m; bringing total underwriting expenses to N6.64bn, compared to N4.165bn in the corresponding period of 2017. Underwriting loss stood at N90.215m, compared to prior profit of N608.641m; which was made worse by the N3.359bn ‘other expenses,’ which rose N570.252m or 20% from N2.788bn.
Investment income rose marginally to N2.11bn from N2.007bn; just as profit from deposit administration dropped from N66.817m to N54.465m’ net realized gains soared to N984.437m from a loss of N30.16m. Other operating income improved to N261.161m from N43.394m; personnel expenses jumped to N1.486bn from N1.223bn; finance cost increased to N67.372m from N64.825m.
AIICO Insurance therefore reported a Profit before tax of N970.985m, which was 44% better than the previous N673.038m; while the tax income of N165.114m from N125.895m resulted in profit after tax closed for the period at N805.871m from N547.143m.
Other comprehensive profit net of tax stood at N174.906m from a loss of N81.755m; which brought total comprehensive profit for the year to N980.777m from N465.387m, which represented a 111% growth over the period, translating to earnings per share of 11 kobo, up from eight kobo.