Continental Re recorded N7.9bn premium in Q2

Continental Reinsurance Plc’s gross premium income rose by 14 per cent from N6.9bn in the second quarter of 2012 to N7.9bn in the same period of the current fiscal year.

The Managing Director, Continental Reinsurance, Dr. Femi Oyetunji, who disclosed this in a statement on Sunday, said the company had managed to defend its leading position in the Nigerian market in the face of growing competition, and continued to progress in its Pan-African growth strategy.

“We have had an encouraging opening half to the year and are on track to achieving our 2013 performance targets. Our key performance indicators are showing positive trends, which should translate to a strong end of year finish,” he said.

He said the company’s retrocession premium of N880.4m in the period under review reflected a ratio of 11.2 per cent, which is the same as the previous period and lower than the budget ratio of 12.1 per cent.

The structure of the 2013 retrocession programme remains the same as in 2012, according to Oyetunji.

The securities on the company’s retrocession programme are highly rated by international rating agencies like AM Best and Standard and Poor’s.

Loss ratio for the half year of 2013 stood at 44.5 per cent, which is a marginal improvement relative to the budgeted ratio of 46.0 per cent, reflecting the conservative and prudent underwriting philosophy of the company, he said.

The managing director said the net acquisition expenses ratio improved to 25.8 per cent in the current year, from 27.3 per cent recorded in the same period of 2012.

The net management expenses ratio to the net premium income at 12 per cent, according to him, is the same as for 2012.

Continental Re’s underwriting profit increased moderately by four per cent from N1.06bn in the second quarter of 2012 to N1.1bn in same period of 2013, spurred by lower acquisition costs and improved claims ratio, but weighed down by an inordinate increase in the provision for outstanding premiums, which is expected to reduce as the year progresses, and conservative reserving for unearned premiums pertaining to unexpired risks.

Investment and other income in the period under review stood at N644.8m, which was higher than last year’s figure of N564m by 14 per cent.  The growth was attributable to an improved investment climate and fair value gains on equities.

Profit before tax stood at N1.4bn and was moderately higher than that for 2012 of N1.3bn, with the company maintaining its robust underwriting performance and healthy returns from its investment activities.

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