Leadway Assurance Company Limited has recorded gross earnings of N22.4 billion for the 2011 financial year.
This figure is a 21.75 per cent increase from N18.4 billion recorded in 2010.
According to the financial statement of the company, gross written premium also increased by 38 per cent to N19.6 billion from N14.2 billion the previous year.
But with huge reinsurance cost, which went up by 29 percent from N7 billion in 2010 to N9 billion at the end of 2011, the company’s net premium earned stood at N10 billion as against N8.6 billion in 2010, a 16 percent rise. The performance was, however, eroded by a significant increase in claims incurred which rose by 129 per cent from N2.4 billion in the previous year to N5.5 billion in 2011.
The rise in claims incurred affected the underwriting profit, which dropped by 19 percent from N4.3 billion to N3.5 billion in 2011, resulting in 24 percent drop in company profit before tax of N1.55 billion, down from N2.03 billion in 2010 while the profit after tax dropped by 49 percent to close at N1.04 billion in 2011.
The profit position of the company was enhanced by investment income, which appreciated by 38 per cent, moving from N1.3 billion in 2010 to N1.79 billion in 2011. The company’s balance sheet size grew by 9 per cent from N39 billion in 2010 to N42.5 billion in 2011, with the value of insurance fund rising by 55 per cent from N11 billion in 2010 to N17 billion in 2011, while shareholders fund closed at N11 billion.
The statements further revealed that with economic /infrastructural reforms, the potential for growth exists and the company is well positioned to take advantage of the insurance value chain.
According to its Chairman’s statement, “the company is positioned to benefit from the National Insurance Commission (NAICOM) Market Development and Restructuring Initiative (MDRI) by increasing the level of awareness needed to deepen insurance penetration in Nigeria through mass awareness campaigns and other programmes for the sale of compulsory insurances”.
Meanwhile, the company declared N500 million dividend, which translates to 5.7 kobo per share.