NEM Insurance Plc has reported strong profit, with balance sheet strength and underwriting focus putting it in a position to weather macroeconomic headwinds.
The firm said net income spiked by 91.43 percent to N3.95 billion in September 2022 from N2.06 billion as at September 2021.
The insurer is efficient at turning shareholder investment into profits as the return on average equity (ROAE) increased to 21.70 percent in the period under review from 14.77 percent as at September 2021, according to MoneyCentral calculations.
Despite the difficult operating environment as obligations to policyholders are mounting on the back of rising inflation and volatility in currency, combined ratio improved to 88.79 percent in September 2022 from 96.86 percent as at September 2021.
The combined ratio is typically expressed as a percentage. A ratio below 100 percent indicates that the company is making an underwriting profit, while a ratio above 100 percent means that it is paying out more money in claims that it is receiving from premiums.
NEM Insurance posted underwriting profit of N6.02 billion as at September 2022, which represents a 52.79 increase from 2021’s N3.94 billion.
The company says its performance has been a consistent upward progression, and it promises to continue to deliver higher returns to shareholders.
“Despite the difficult operating environment, coupled with increased claims profile due to some very big claims paid during the period under review, we were still able to record some modest achievements in most of our indices,” said Tope Smart, Group Managing Director, NEM Insurance.
“With a very strong foundation and brand reputation, we are well-positioned to move to the next level even as we continue to delight all our stakeholders,” said Smart.
The company has paid N4.84 billion as at September 2022, which is 22.58 percent lower than 2021’s N6.25 billion the previous year.
Claims ratio reduced to 29.03 percent in the period under review from 40.84 percent the previous year.
NEM Insurance’s gross premium written (GPW) was up 23.91 percent to N28.71 billion in the period under review from N23.17 billion as at September 2021.
A breakdown of GPW shows revenue from Motor increased by 36.78 percent; Marine, 6.79 percent; Fire, 30.79 percent; General Accident, 25.93percent; Oil and Gas, 13.38 percent.