By Patience Saghana

Sovereign Trust Insurance Plc is set to hold its 2009 annual general meeting, having been granted approvals by the National Insurance Commission (NAICOM) and the Nigerian Stock Exchange (NSE)

Mr. Wale Onaolapo, Managing Director said 2009 was indeed a challenging year occasioned by the global financial meltdown of 2008 that saw many organisations struggling for relevance in the economic landscape across the world.

He said, “The situation also took its toll on the insurance industry in the country. The effect of the challenges was apparent on premium generation capabilities as most organisations reduced their insurance budgets drastically. The resultant effect was steep liquidity and reduced profitability on businesses generated”.

Sovereign Trust Insurance Plc recorded a Gross Premium of N4.4 Billion in 2009, a performance which represents 16.5% over N3.81 Billion recorded in the corresponding period of 2008. Total Asset stood at N5.26 Billion at the end of the year as against N5.37 Billion recorded in the corresponding period of 2008.

Underwriting profit for the year was N1.95 Billion which represents 25.4% increase as against N1.56 Billion recorded in 2008 while Profit before Tax (PBT), stood at N13 Million as against N415.65 Million achieved as at the year end, 31st December, 2008.

The significant reduction in the profit according to the Head of Corporate Communications and Brand Management, Mr. Segun Bankole is attributable to a to a sum of N358 Million written off as losses relating to diminution in value of capital market related investments, N291 Million written off as outstanding premium in line with NAICOM guidelines and a sum of N247 Million deferred charges that was also written off at year end. He said “the company’s determination to completely write off those items is borne out of the desire to adopt international best practice and to also position the company for better returns in the years ahead.