Wapic Insurance Nigeria Plc has ended 2015 financial year on an impressive as Full year profit surged 444.65 percent amid rising claims expenses and increased combined ratios.
The 2015 audited financial statement showed net income jumped to N1.29 billion from N236.83 million the previous year.
Profit before tax increased by 2,115 percent to N1.66 billion as the company’s bottom line got a boost from gains on profit of sale of associate worth N764.43 million.
Wapic also recorded a strong underwriting performance as net premium income increased by 39.22 percent to N3.94 billion in December 2015 compared with N2.83 billion as at December 2014.
Gross premium written (GPW) grew by 36.51 percent to N6.40 billion, validating the insurers’ investment in innovative and market driven products.
The Nigeria insurer recorded an increase of 12.74 percent in underwriting profit despite a 63.97 percent rise in net claims to N1.63 billion.
A high claims expenses means the company is aggressive about the settlement of claims to policy holders.
Combined Ratios (CR) jumped to 73.35 percent in December 2015 as against 65.30 percent at December 2014.
A CR below 100 percent means an insurance company is profitable and has financial strength and its going concerns are not threatened.
However, Wapic should watch its CR levels while pursuing its strategic objective of maximizing the wealth of shareholders.
The B rating conferred on the Wapic by A.M. Best, a global credit rating agency, validates the company’s strong underwriting performance in the previous quarters.
The insurer was also awarded an Issuer Strength Rating, ISR, of ‘BB-’ by the rating agency.
The rating grade underscores the company’s enhanced underwriting capabilities, performance and its strong enterprise risk management framework.
The rating also recognizes Wapic’s respectable liquidity position and strong risk-adjusted capitalization underpinned by the firm’s improved assets quality.
Stemming from these, the company’s was assigned a stable outlook as its overall rating.