African Reinsurance: Gross written premium 1.8% up in 6 months
The African Reinsurance Corporation (Africa Re), the leading reinsurer in Africa, has secured a half year gross written premium growth of 1.8 percent, the corporation revealed.
The corporation secured a gross written premium of US$348.46 million in the first half of 2015 against US$342.47 million the previous year. The 1.8 percent increase comes despite the negative impact of operating currencies depreciation estimated at US$34.7 million, Africa Re said in its latest financial result statement.
At constant exchange rate, the growth in premium income would have been 11.88% for the same period. Increased premium income from treaties as a result of additional shares secured during treaty renewals explains that performance.
For the six month period ended June 30, 2015, Africa Re recorded a stable performance in terms of net profit at US$32.09 million from US$32.4 a year earlier. The investment income decreased 33 percent for the same period.
“This commendable bottom line performance is mainly attributable to improved underwriting performance with an underwriting profit of US$12.5 million which almost doubled from the US$6.6 million recorded last year at the same period.” Africa Re said.
Investment Income earned by the corporation dropped from US$27.1 million to 18.2 million following the decrease of the return on investment from 5.46 percent to 3.38 percent at same period last year.
“Investment income was impacted negatively by the timid growth of the equity market and the negative performance of the US bonds market.” The corporation attributed.
Africa Re added in its statement that it expects the performance to improve in the second half of the year 2015, backed by sustained marketing efforts, active review of loss-making risks, prudent underwriting and management of investments and barring any catastrophe claims or further negative effects of the depreciation of African currencies.
In June, A.M. Best affirmed the financial strength rating of A- (Excellent) and the issuer credit rating of “a-” of African Reinsurance Corporation (Africa Re), saying the outlook for both ratings was positive.
