27.2 C
Lagos
Wednesday, November 30, 2022

AxA Mansard surmounts headwinds as profit margin surges

Must read

- Advertisement -

Despite the current market conditions and global macroeconomic uncertainties stoked by the coronavirus pandemic, AXA Mansard Insurance Plc has been able to bolster profit margins, thanks to a diversified product base.

That means the largest insurer by market capitalization in Africa’s largest economy has turned turned each Naira invested in premium income into higher profits amid mounting claims obligations.

Data gathered by Money Central shows net income surged by 119.20 percent to N1.95 billion in March 2020 from N889.96 million in 2019, causing a rise in annualized return on average equity (R0AE) at 28.42 percent up from 14 percent in 2019.

A higher profit return has translated into attractive valuation as price to earnings ratio stood at 5 times, while market capitalization was N17.95 billion as 2:00 pm on May 24 Friday in Lagos.

The improvement in headline figures was largely driven by the introduction of market penetrating products, as health segment continues to contribute to Group earnings.

Gross premium income (GPI) spiked by 20.43 percent to N11.61 billion as at March 2020 from N9.64 billion the previous year while net premium followed the same growth trajectory as it was up 37.81 percent to N8.20 billion in the period under review.

The insurer raked in N7.36 billion from its cash cow, Health Maintenance Organization (HMO), controlled by subsidiary, AXA Mansard Health. That represents a 57.26 percent increase from 2019’s N4.68 billion.

AXA Mansard Health Limited introduced its telemedicine to help improve access to quality healthcare service to all Nigerians during the COVID-19 pandemic.

AXA Mansard Insurance says it is offering a two-week free insurance cover on all renewals of its comprehensive motor insurance policy.

AXA Mansard’s claims expenses have been mounting as it spent more on claims expenses in generating each unit of revenue.

Total net claims expenses increased by 40.80 percent to N5.59 billion in the period under review from N3.97 billion as at March 2019. Claims ratio moved to 68.17 percent as at March 2020 as against 66.72 percent.

The insurer recorded underwriting profit of N2.05 billion as March but combined ratio stood at 106.44 percent, which exceeds the 100 percent benchmark.

- Advertisement -

More articles

LEAVE A REPLY

Please enter your comment!
Please enter your name here

This site uses Akismet to reduce spam. Learn how your comment data is processed.

- Advertisement -

Latest article