WorldStage– African Alliance Insurance Plc recorded a significant reduction in its losses for the second quarter ended June 30, 2023, driven by a substantial decline in net underwriting expenses.
According to the un-audited management account submitted to the Nigerian Exchange (NGX), the insurer reported a loss before tax of ₦573.70 million for Q2 2023. This represents an 84% improvement compared to the pre-tax loss of ₦3.52 billion recorded in the corresponding period of 2022. Loss after tax similarly improved by 83%, standing at ₦582.33 million compared to ₦3.52 billion in Q2 2022.
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Key Financial Highlights
Gross Premium Written (GPW): Stood at ₦3.63 billion, down 4% from ₦3.79 billion reported in Q2 2022.
Gross Premium Income (GPI): Totaled ₦3.20 billion compared to ₦3.58 billion in the prior-year period, representing an 11% decline.
Net Premium Income: Dropped 9% year-on-year from ₦3.46 billion to ₦3.16 billion.
Underwriting Performance: Underwriting loss dropped sharply by 95% to ₦137.09 million in Q2 2023, compared to an underwriting loss of ₦2.98 billion in Q2 2022.
Claims Paid: Remained flat at ₦3.34 billion compared to ₦3.32 billion in Q2 2022.
Total Assets: Stood at ₦49.10 billion as of June 30, 2023, down 3% from ₦50.52 billion as of December 31, 2022.
Total Liabilities: Contracted slightly by 2% to ₦45.16 billion, compared to ₦46.00 billion as of December 31, 2022.
Total Equity: Closed at ₦3.94 billion, down 13% from ₦4.52 billion recorded at year-end 2022.
Underwriting and Segmental Insights
The sharp reduction in underwriting loss was primarily buoyed by changes in contract liabilities, which posted a positive movement of ₦758.63 million against a negative charge of ₦2.47 billion in Q2 2022. Overall net underwriting expenses decreased by 49% from ₦6.44 billion in Q2 2022 to ₦3.31 billion in Q2 2023.
A breakdown across business segments reveals mixed performances:
Group Life: Generated the highest gross premium written at ₦1.84 billion and delivered an underwriting profit of ₦1.02 billion.
Individual Life: Contributed ₦1.28 billion in GPW and recorded an underwriting profit of ₦238.02 million.
Esusu Segment: Posted ₦183.39 million in GPW and an underwriting profit of ₦620.08 million.
Annuity: Generated ₦19.97 million in GPW but incurred an underwriting loss of ₦2.00 billion due to net claims expenses of ₦2.02 billion.
Takaful: Generated ₦317.60 million in GPW, recording a marginal underwriting loss of ₦17.42 million.
Investment and Operating Expenses
Investment and other income registered at ₦1.19 billion, reflecting a 22% increase from ₦973.48 million in Q2 2022. However, operating expenses rose 10% to ₦1.33 billion from ₦1.21 billion in the previous period.
Basic loss per share for the period stood at 0.03 kobo, compared to 0.17 kobo per share in Q2 2022.
