AIICO Gross Premium Income Hits N62bn In FY 2020 As Total Assets Grow by 52.5percent

By LOVETH AZODO, Lagos

AIICO has reported a gross premium income of N62bn in FY 2020 as against 50.1bn in 2019 representing 23.6 percent increase.

The Insurance company announced its audited results for the year ended 31 December 2020 in a statement signed by its head, strategic marketing & communications, Segun Olalandu,

The Company’s Total assets increased by 52.4percent to ₦243.1 billion in FY 2020 as against ₦159.5 billion in 2019.

Total liabilities also grew by 59.6percent to ₦208.4 billion in FY 2020 as against ₦130.6 billion in 2019.

Total equity increased by 19.9percent to ₦34.7 billion in FY 2020 as against ₦28.9 billion in 2019 while Investment income grew by 13.1% y-o-y to ₦11.7 billion in FY 2020 as against ₦10.4 billion in 2019.

The Company attributed the growth to the continued investment in its agency force, an increased focus on partnerships and better relationship with corporates.

However, the company had an underwriting loss which stood at ₦36.3 billion from ₦7.7 billion in 2019.

According to the statement, the loss was due to 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.

Also, Profit before tax from continuing operations declined by 22.6% y-o-y to ₦4.6 billion in FY 2020 from ₦6.0 billion in 2019 while Profit after tax from continuing operations declined by 12.9percent y-o-y to ₦5.0 billion in FY 2020 from ₦5.7 billion in FY 2019, Profit for the year declined 11.1percent y-o-y to ₦5.2 billion in FY 2020 from ₦5.9 billion in 2019.

“This was largely due to the lower-than-expected profits in our Life business as a result of higher-than-expected reserving requirements/low yields. However, our General Insurance and Wealth Management businesses increased their contribution to profits,” it stated.

Commenting on the results, the Managing Director and Chief Executive Officer Mr. Babatunde Fajemirokun said, “The pandemic caused fundamental assumptions about the global marketplace to be questioned and led to a global economic upheaval. 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% 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”.

He stated further, “Over the past 5 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% year-on-year despite restrictions caused by the pandemic. Our financial position remains strong, inspiring confidence in our ability to assume the risks our customers wish to transfer. Our investors echo this faith as our rights issue announced in September 2020 was oversubscribed by about 26%. We deploy this capital judiciously, generating risk-adjusted returns for our shareholders, and ensuring that we can continue to keep our promises,” he said.