Leadway Assurance Plc is using its capacity to underwrite new policy as evidenced by a low net premium to policy surplus ratio, validating the recent upgrade of the insurer’s national scale financial strength to AA (NG) from AA-(NG) by GCR ratings.
Net premium to surplus ratio, which is net premium written divided by policyholder surplus, fell to 55.21 percent in December 2020 from 132.12 percent as at September 2019, according to MoneyCentral calculations.
Leadway Assurance has steadily grown its ordinary shareholders’ equity with solid earnings. As a result, shareholders’ equity has increased by 25.63 percent to N67.44 billion in December 2020 from N53.68 billion in December 2019.
An increase in shareholders’ fund or policyholder surplus means the insurer will be able to underwrite new policies and underpins the amount of premium it will receive from policyholders.
The insurer has been able to increase the gap between assets and liabilities by effectively managing the risks associated with underwriting new policies, by reducing losses from claims, and by investing its premiums to achieve a return while maintaining liquidity.
Leadway Assurance’s strong operating performance, solid balance sheet and financial flexibility, and diverse sources of revenues and earnings validates investment houses’ optimism that it will meet the new minimum capital requirement target of the regulator.
It has an excellent asset allocation strategy and a strong liquidity that gives the impetus to invest in fixed income security, earning higher returns even amid a low yield environment.
Investment income was up 55.56 percent to N37.27 billion in the period under review from N31.80 billion the previous year. Fair value gain on listed securities surged by 123.01 percent to N78.21 billion as at December 2021.
“The robustness of the company’s balance sheet, which has seen us grow our Total Asset Base by 32% from N396 billion in 2019 to N523 billion in 2020, was hinged on a strong return on our investment portfolios. With a Board of reputable professionals whose strategic actions are anchored on strong corporate governance, our core values and global best practices, there is assurance of delivering sustainable performance and results,” said Tunde Hassan-Odukale, Managing Director/Chief Executive Officer, Leadway Assurance.
“As we continue in this new decade, we reaffirm our mission to deliver world-class insurance services to individuals and corporates in Africa. With support from digital transformation, robust risk management tools, innovative solutions and superior financials, our existing and prospective stakeholders can rest assured that we will continually fulfil our quest of “insuring the happiness” of our publics,” said Odukale.