By Patience Saghana
Africa Reinsurance Corporation posted a net premium income of $393.46million (N51.17billion) for the financial year ended December 2008 just as the South Africa is the reinsurer largest market with a premium income of $127.08million (N19.06billion) representing 31.69 percent ofÂ Africa Reâ€™s total income.
The net premium income of the company moved up from $366.40million (N54.96billion) in 2007 to $393.46million (N59.02billion) in 2008 whilst it recorded a written premium of $401.04million (N60.16billion) compared to 4$369.51million (N59.48billion) generated in 2007, an increase of 8.53 percent.
Africa Re chairman, Mr Musa Al Naas said 2008Â the performance was driven by an improved marketing effort that led to higher participation in both treaty and non-obligatory business though the year under review, he admitted, was a challenging year for both reinsurance and insurance companies.
According to him, â€œ2008 was a year of enormous challenges for professional insurers and reinsurers. Indeed, the financial crisis dealt a harsh blow on all sectors of the economy, industrialized as well as emerging and developing countries, natural catastrophes (cyclones, snow, storms, earthquake) and man-made disasters caused damages worth USD225billion (N33.75tillion) out of which USD50billion (N7.5trillion) involved insured lossesâ€
Al Naas stated, â€œ2008 witnesses a significant increase in the frequency and severity of major risk losses. It was reported that the total amount of major risk losses in 2008 exceeded the combined total of 2007 and 2006â€
Despite all that, the Africa Re chairman said that the corporationâ€™s performance cuts across practically all the production centres due to continued weakness of the reinsurerâ€™s major currency, Dollar.
The cumulative translation adjustment which is being accounted for a separate component of the shareholders funds recorded an unrealised loss of $31.27million (N4.69billion) (2007: $14.95million (N2.24billion) as a result of the continuing weakness of the corporationâ€™s major operating currencies (South Africa rand 35.27 percent; Kenya Shillings 22.57 percent; Nigeria Naira 18.49 percent and Mauritius Rupee 12.79 percent against the US Dollar.â€
Meanwhile the geographical breakdown of the premium income of Africa showed that the corporation raked $127.08 (N19.06billion) representing 31.69 percent in 2008 as against 44 percent posted in 2007; East Africa contributed $52.33million (N7.84billion); Anglophone West Africa $50.71million (N7.61billion); North Africa $46.73million (7.01billion); North East Africa $31.28million (N4.69billion); Francophone Africa$27.81million (N4.17billion); Africa Indian Ocean Islands $10.20million (N1.53billion) and international business $54.90million (N8.24billion).
Mr Bakary Kamara, Managing Director of Africa Re said the company would next year begin an increase in its capitalisation process to N500million (N75billion) which it hoped to conclude between 2012 and 2013.
Moreover, Kamara said the corporation wished to venture into new products which include takaful insurance, an islamic insurance products.