BY ROSEMARY ONUOHA

Prestige Assurance Plc has posted a profit after tax of N255.990 million for the financial year ended December 31, 2011 according to the company’s audited result released by the Nigerian Stock Exchange, NSE, last week.

The figure represents a 47.51 per cent decline from the profit after tax of N487.698 million recorded by the company in 2010.

Experts are of the opinion that the decline in profit after tax may not be unconnected to the apathy for insurance from the public and the declining purchasing power of the average Nigerian.

Meanwhile, net assets of the company stood at N4.743 billion as against N4.755 billion recorded the preceding year while gross premium income stood at N4.173 billion in contrast to N3.860 billion realised in 2010.

Prestige Assurance which is an active underwriting firm in the Nigerian insurance sector recently got the pledge of its core investor, New India Assurance Company Limited to make its technical and managerial competence available. New India said the move is to reposition Prestige to become more competitive in the local market.

Chairman of the company, Mr. Annur Sekar, who made the assertion in Lagos said that the low insurance penetration in the country was in itself an opportunity for deepening the growth of insurance in the Nigerian economy.

According to him, the fact that Prestige Assurance survived the harsh economic conditions in recent times, having been in existence in the country in the last 60 years was a testimony to the healthy business environment in the country.

He assured that New India would continue to provide both technical and technological support to Prestige Assurance to ensure that its market share goes up in the near future.

Sekar who compared the  Nigerian insurance market with that of India observed that market penetration poses great challenge to the two markets, saying the only way out of this crisis is the creation of innovative products that addresses the needs of the insuring public.

He also advised that the operators should make use of appropriate channels of distribution to get their products across to the insuring public wherever they may be and in a timely manner too.

The Chairman also advised that the operators must strive at all times to sustain the interest of their customers in insuring their properties by way of meeting their claims needs whenever the need for this arises.

He also assured that New India would always support Prestige and uphold market regulations for the growth and development of the country, enforcement of discipline by the regulator and protection of policyholders’ rights in Nigeria.

According to him, “strict regulation is the same all over the world, particularly now that insurance organisations are expected to do things in a different way and embrace Solvency II and the International Financial Reporting Standards (IFRS)”.

Owned 100 per cent by the Indian government, New India Assurance Company Limited prides itself at the largest non-life insurance group in the Afro-Asian countries with the exception of Japan and it retains 51 per cent stake in Nigeria’s Prestige Assurance Plc.

New India has subsidiaries in over 20 countries across the region and retained its solvency rating of A- by AM Best, an international rating agency.

Prestige Assurance was set up in Nigeria about 60 years ago and owned wholly by New India and in observance of the Indigenisation Decree of the Federal Government in early 70’s, the company transformed into a Nigerian firm with New India retaining 40 per cent stake in it.

During the last recapitalisation exercise in the country, New India restated its confidence and commitment to the Nigerian insurance industry by increasing its stake in the company to 51 percent, making it the core investor in the company.