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Wednesday, September 27, 2023

AIICO Retains Top Spot as Largest Listed Insurer by Total Assets

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AIICO Insurance Plc retains its position as the largest listed insurer by total assets, thanks to financial assets and cash/cash equivalent, which validates the insurer’s excellent asset allocation strategy.

The insurers’ total asset stood at N251.32 billion as at December 2020, that compares with Custodian Investment, N176.15 billion; AXA Mansard, N99.27 billion; Mutual Benefit Assurance, N82.84 billion; Cornerstone Insurance, N43.40 billion; Coronation Insurance, N39.55 billion; Linkage  Insurance, N32.91 billion; Royal Exchange,N32.25 billion, and Niger Insurance, N22.09 billion.

AIICO Insurance’s total asset, which represents a 57.57 percent increase from last year’s N159.47 billion, was largely driven by 46.23 percent and 336.80 percent increase in financial asset and cash and cash equivalent to N185.46 billion and N44.03 billion in December 2020 from N126.82 billion and N10.08 billion in 2019.

However, there are growing concerns that the coronavirus pandemic could undermine the asset or inflow side of insurers, as deteriorating fixed interest securities is another risk on the horizon.

The disruption to economic activities brought on by Covid-19 has forced many retail and commercial customers to mull cutting down on speed as there has been downhill in most products and markets.

 Also, commercial renewals and policies will be delayed, and many brokers are struggling to operate in a disrupted or dislocated market.

Analysts have warned that there could be rising claims or high payout due to the virus that led to business interruption cover, and the death toll from the crisis means operators in the Life segment are exposed to huge liabilities.

“Payouts are undoubtedly set to rise, and perhaps significantly. In many ways, we are sitting in the calm before the storm at present. It is still unclear how much the situation could eventually cost,” said analysts at accounting and tax consultant, KPMG.

“But payouts for the tragic deaths that have occurred, as well as for health claims, mental health and many kinds of non-life cover will grow. This is before we even mention the elephant in the room which is business interruption cover,” said the analysts.

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