AIICO Insurance Plc capital position has improved in the first six months of 20525, helped by higher interest rates even amid rising expenses that squeezed profit margin.
AIICO Insurance’s solvency ratio – the extra capital an insurer must hold over and above the claim amounts it is likely to incur – rose to 523 percent as at June 2025 from 373 percent in June 2024, according to data gathered by MoneyCentral.
The solvency ratio is calculated by dividing the eligible own funds by the Solvency Capital Requirement. A ratio above 100 percent means full compliance with regulatory requirements. The higher the ratio is, the stronger the balance sheet of the company appears.
Of course, the insurer’s capital position has been largely supported by higher interest rates that lifted the retained earnings or reserves, which indicates the company can pay up its claims as it stands on solid financial grounds.
It is noteworthy that the insurer made N27.60 billion from investment income from bonds and equity, which is 49.75 percent higher than 2024’s total.
The Central Bank of Nigeria (CBN) has announced the retention of the Monetary Policy Rate (MPR) at 27.5 percent, following the conclusion of its 301st Monetary Policy Committee (MPC) meeting held recently.
The yield on Nigeria 10 year bond yield rose to 16.02 percent on July 29, 2025, marking a 0.06 percentage point increase from the previous session. Over the past month, the yield has fallen by 2.71 points and is 4.63 points lower than a year ago, according to over-the-counter interbank yield quotes for this government bond maturity.
However, rising claims expenses on the back of inflationary pressures and insurance contract expenditure took a toll on profit.
Profit after tax (PAT) fell by 13.05 percent to N11.26 billion in June 2025 from N12.95 billion the previous year.
There was an improvement in premium income as each segment contributed to the overall Group figure, which indicates the acceptance of products by customers.
Insurance revenue increased by 34.02 percent to N65.42 billion in the period under review from N48.81 billion as at June 2024.
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