By Peter Egwuatu
NEM Insurance Plc, has decried the harsh operating environment experienced in the financial year 2021, even as shareholders of the Company endorsed the Board of Directors proposed 22 kobo per share dividend.
The Chairman of NEM Insurance, Dr Fidelis Ayebae, emphasized this at the the 2021 Annual General Meeting (AGM) in Lagos.
The Chairman said: ” The rising inflation, insecurity, climate change, Russia/ Ukraine war, hike in fuel pump price, unstable labour market and new waves of COVID-19, among others are part of challenges in the year under review.”
Ayebae expressed optimism that the company would record enhanced performance in the current period.
He said : “As the situation continues to be very dynamic, the company has been working diligently to assess the potential risks posed by COVID-19 to its business on an ongoing basis and to realign its strategies accordingly.
“We are of the opinion that our business operations will not suffer any major setback on account of these major challenges.
“The board and management will continue to leverage its robust technology infrastructure and maintain a healthy result and asset base.”
On recapitalisation, Ayebae noted that in spite of the suspension of the process by the National Insurance Commission (NAICOM), NEM Insurance was poised to recapitalise and had enough reserve to do so.
Meanwhile, the Company generated a gross premium of N27.8 billion for the financial year ended December 31, 2021, indicating an increase of 26 per cent when compared with N22 billion achieved in 2020.
The underwriter during the period under review posted net premium of N19.3 billion from N15.8 billion recorded in the corresponding period of 2020, an increase of 23 per cent.
The insurance firm incurred a gross claim of N11.6 billion during the review period as against N8.4 billion in 2020, an increase of 26 per cent.
In the same vein, the net claims expenses of N5.6 billion incurred in 2021 was nine per cent lower than that of the preceding period which was N6.05 billion.
The net claims ratio for the period under review was 20 per cent as against 27 per cent in 2020 due to good claims recovery during the period under review .
The Group’s Earnings Per Share (EPS) for the year under review stood at 89k in contrast with 96k in 2020.
Group’s Profit After Tax (PAT) stood at N4.45 billion in 2021 lower than N5.08 billion in the previous year, representing a decrease of 12.5 per cent.
In his address, the Group Managing Director/Chief Executive Officer, NEM Insurance, Mr Tope Smart, said that the company recorded positive performance in the review period.
Smart explained that the global health crisis in year 2020 which further compounded the fragile economic situation in Nigeria took its toll on households and corporate bodies.
He said: “Despite this difficult terrain, our company showed resilience and we were able to post impressive results.”