AXA Mansard, a firm that engages in the provision of life and general business risk management, has improved its combined ratio in the first quarter amid challenging market conditions, but profitability declined.
In the first quarter of 2022 the composite insurer improved its combined ratio by 3.3 points compared to the quarter a year earlier, coming in at 99.55 percent.
It posts underwriting profit of N1.82 billion as at March 2022.
However, net income dipped by 85.32 percent to N386.28 million as at March 2022 from N2.63 billion the previous year.
The reduction at the bottom line (profit) was largely driven by N1.03 billion changes in individual life reserve.
There was a slight increase in investment returns as companies are taking advantage of a benign yield environment as both short- and long-term government securities have been rising gradually.
Investment income was up 0.82 percent to N1.48 billion in the period under review from N1.47 billion as at March 2021.
AXA Mansard has been honoring its obligation to policyholders as it paid N7.70 billion in claims, which is 42.24 percent higher than 2021’s N5.41 billion.
Loss ratio moved to 66.61 percent in March 2022 from 64.85 percent the previous year.
The company delivered strong revenue growth across all its business lines despite the challenging macroeconomic terrain as inflationary pressures, high utility bills, and spiral unemployment hinders Nigerians from taking up a cover.
It grew its top-line premiums written significantly, with gross premiums of N17.25 billion reported for compared to N12.81 in Q1 2021. Net premium written also followed the same growth trajectory as it spiked by 38.70 percent to N11.51 billion in the period under review as against N8.34 billion the previous year.
Gross premium from Life (Group life and individual life) was up 57.74 percent to N5.61 billion while non life fell by 4.56 percent to N12.13 billion as at March 2022.
Revenue from Health Maintenance Organization (HMO) was up 25.05 percent to N10.49 billion as at March 2022.
Several ratings agencies have upgraded their ratings on AXA Mansard to positive due to the insurer’s balance sheet, strong earnings, and improved underwriting capabilities.
Of course, the firm has enough capital to retain risk and pay claims without threatening going concerns in a hard market. It has also met the minimum capital requirement set by the regulator who is steadfast in ensuring that the industry is on a sound footing and in a position to compete with emerging market peers.