In the challenging macroeconomic environment of 2023, AIICO Insurance has maintained a strong solvency margin ratio, recording 182 per cent in the third quarter, up from 154 per cent recorded in the same period in 2022.
As of September 2023, AIICO Insurance had maintained a strong solvency margin for the first nine months of the year, indicating a healthy balance sheet and adequate liquidity. The company’s strong earnings position is supported by its solid financial position, even though its underwriting performance has been negatively impacted by the current economic conditions. This data is based on information from the company’s website, which provides a comprehensive view of its financial health.
The solvency ratio is a critical metric used to assess the financial health of insurance companies. It is calculated by dividing a company’s assets by its liabilities, and a ratio above 1 indicates that the company has enough assets to cover its liabilities. In the case of AIICO Insurance, its solvency ratio indicates that the company has more than enough assets to cover its liabilities.
In more detail, AIICO’s total admissible assets, which can be used to cover its obligations, amounted to N32.18 billion, while its total admissible liabilities, which includes claims payments and other obligations, totaled N18 billion.
AIICO reported a 22.5 per cent increase in gross premiums written, to N85.1 billion, based on the International Financial Reporting Standards (IFRS) 4, while group revenues increased 31.9 per cent year-on-year to N51.3 billion, a significant increase from N38.9 billion
In the nine months ending September 2023, AIICO’s insurance service result, which is the difference between insurance revenue and expenses, was N215.8 million, a significant decline from N1.3 billion recorded in the same period last year.
AIICO’s total income or net insurance and investment result, which is the sum of all insurance and investment income and expenses, grew by 83.1 per cent to N8.7 billion in the nine months period ending September 2023. This significant increase was due to a combination of factors, including an increase in investment income and the depreciation of the naira against the US dollar.
AIICO’s profit before income tax from continuing operations increased by 182% to N6.7 billion, compared to N2.4 billion in the same period last year.
Meanwhile, total assets grew by 11.8 per cent to N300.7 billion in the nine months ending September 2023, an increase from N269.0 billion in the same period last year. This growth was primarily driven by a 9.4 per cent increase in financial assets, which make up 82.0 per cent of the total assets.
During the nine months period ending September 2023, AIICO’s total equity increased by 11.3 per cent to N44.1 billion, up from N39.6 billion in the same period last year. The increase in equity was primarily driven by a 30.3 per cent increase in retained earnings to N14.6 billion.
In his comments on the results, Babatunde Fajemirokun, managing director and CEO of AIICO, noted that the company’s strong performance in the third quarter is a testament to its resilience and the sustainability of its business model.
Fajemirokun attributed the company’s success to its strategic focus on product innovation, customer service, and risk management.
“It highlights the wisdom of our strategic investments aimed at improving our value proposition, diversifying our product range, and elevating our technological capabilities,” he said.
Fajemirokun went on to emphasize the company’s commitment to maintaining the trust of its customers, which is a core part of its values. He highlighted the importance of providing high-quality products and services, especially during challenging times. He noted that this commitment is a key driver of the company’s success and will continue to be a focus in the future.