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AIICO Insurance records N60.7bn gross premium



AIICO Insurance
L-R: Mr. Ademola Adebise (Non Executive Director); Mr. Babatunde Fajemirokun (MD/CEO); Mr. Donald Kanu ( Company Secretary) and Mr. Adewale Kadri (Executive Director, Technical & Head, Corporate Business) File photo

AIICO Insurance Plc has declared that it recorded N60.7 billion as its Gross Written Premium in its audited results for 2020.

The company disclosed this in a statement signed by the insurer’s Head of Marketing Strategy and Communication, Segun Olalandu, and made it available to newsmen in Lagos on Tuesday, April 7.

The statement read that the N60.7 billion represented 21.3 percent growth when compared to the 2019 financial year figure of N50.1 billion.

According to it, the growth to continuous investment in the agency’s force, increased focus on partnerships and better relationship with corporates.

Olalandu also said that the firm recorded an underwriting loss of N36.3 billion in 2020 compared to N7.7 billion in 2019.

He attributed the loss on two main factors — reserving requirements for new policies underwritten in the life business in 2020 and changes in actuarial reserves in the life business for policies written in 2020 and prior years.

The spokesman said: “There were significant movements in investment yields which affected the value of liabilities and assets in our life business.

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“On the short and long ends of the yield curve, yields declined by about 7.7 per cent and 5.5 per cent respectively in 2020. ”

“The effects of these changes are reflected in the change in life and annuity funds, as well as fair value gains or losses on the income statement.  Some of these products require higher reserving requirements which results in an increase in our liabilities, thereby reducing reported underwriting profits.”

He added that the underwriting performance in the general business also declined due to increased claims in fire because of the civil unrest across the country and special oil lines.

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Olalandu said that the investment income of the insurer grew by 13.1 percent year-on- year to N11.7 billion in 2020 financial year from N10.4 billion in 2019 financial year from increased assets under management.

He said profit before tax from continuing operations declined by 22.6 per cent year-on-year to N4.6 billion in 2020 financial year from N6.0 billion in 2019 financial year.

According to him, the drop was due to the lower-than-expected profits in the company’s Life business as a result of higher-than-expected reserving requirements/low yields.

Babatunde Fajemirokun, Managing Director/Chief Executive Officer of the insurance company was quoted in the statement to have said that the pandemic caused a questionable global marketplace and led to a global economic upheaval.

Fajemirokun explained that the Nigerian economy slipped into its second recession in five years, with the business environment further impacted by incidents of civil unrest.

“Despite these unprecedented macroeconomic disruptions, AIICO grew its total assets by 52.5 per cent in the year under review.

“We delivered sound results having taken decisive early actions to protect our workforce, improve our financial strength, streamline operations and reinforce our distribution strategy.

“Over the past five years, we invested substantially in human capital and technology to significantly elevate our customer experience. “This resulted in our gross written premiums growing 23.6 per cent year-on-year despite restrictions caused by the pandemic, ” he said.




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