All Posts in "Month: August 2021"

Global insured cat losses hit $42bn in H1 2021: Swiss Re’s Sigma report

By admin

Global catatrophic osses for the first half of 2021 has reached $40 billion, driven by a deep winter freeze, hailstorms and wildfires, according to Swiss Re Institutes’ preliminary sigma report.

This is above the previous ten-year average and is only exceeded by H1 2011, when major earthquakes in Japan and New Zealand pushed the six-month total to $104 billion.

Man-made disasters triggered another estimated $2 billion of insured losses in the first half this year, less than usual and likely reflecting remaining COVID-19 restrictions.

“The effects of climate change are manifesting in warmer temperatures, rising sea levels, more erratic rainfall patterns and greater weather extremes,” said Martin Bertogg, Head of Cat Perils at Swiss Re.

Taken together with rapid urban development and accumulation of wealth in disaster-prone areas, secondary perils, such as winter storms, hail, floods or wildfires, lead to ever higher catastrophe losses.

“The experience so far in 2021 underscores the growing risks of these perils, exposing ever larger communities to extreme climate events. For example, winter storm Uri reached the loss magnitude that peak perils like hurricanes can wreak.

“The insurance industry needs to upscale its risk assessment capabilities for these lesser monitored perils to maintain and expand its contribution to financial resilience.“

Global economic losses from disaster events are estimated at $77 billion in the first half of 2021. This is below average for the past ten years

Swiss Re notes that the economic loss figure is expected to rise as more losses are accounted for in the coming months. The first half of the year is also not representative of the full-year figures.

Of the total estimated economic losses in the first half of 2021, $74 billion were caused by natural catastrophes, while man-made disasters triggered an additional $3 billion.

“Climate change is one of the biggest risks facing society and the global economy,” said Jérôme Jean Haegeli, Swiss Re’s Group Chief Economist.

“The recent analysis from the UN’s Intergovernmental Panel on Climate Change confirms expectations of more extreme weather in the future and urgency to act to limit global warming.

“Working with the public sector, the re/insurance industry plays a key role in helping to strengthen communities’ resilience by steering development away from high-risk areas, making adaptation investments, maintaining insurability of assets and narrowing protection gaps.“

by Patoma Admin — August 13, 2021 in Insurance 0

AIICO Insurance maintains deliberate collaboration with Insurance, Pensions Journalists

By Favour Nnabugwu

The Managing Director of AIICO Insurance Plc, Mr Babatunde Fajemirokun, has said the company ensure a deliberate and sustained collaborative partnership with members of NAIPCO to build their capacity for enhanced performance.

Fajemirokun said the company is passionate about National Association of Insurance & Pension Correspondents, NAIPCO and its critical roles in the growth of the industry, adding that, “we are committed to working with you to achieve your objectives as highlighted to us in your proposal.”

“We are always passionate about NAIPCO. Whenever issues are raised about NAIPCO, we always think of how to work together because of your critical role as a purveyor of information.”

Represented by Head, Strategic Marketing and Communications Department, Mr. Segun Olalandu, commended the efforts of NAIPCO in creating awareness and educating the public on the benefits and advantages of insurance as a risk-mitigating mechanism and a tool for poverty alleviation and wealth creation, also stressed the prime place of the media in nation-building.

While describing NAIPCO as a “very important association and strategic” for the nation’s insurance industry, he assured the Association of his company’s continued supports..

The training workshop, theme “Financial Understanding And Analysis” is aimed at building journalists’ capacity and broadening their knowledge in the industry’s financial reporting.

Earlier in his opening remarks, the Chairman of NAIPCO and Publisher of Inspen Online, Chuks Udo Okonta, commended AIICO for their support and pledged the Association’s commitment to work with AIICO for actualization of its corporate objectives.

“We are here today because of you. We will never take this for granted. We will ensure that knowledge gained in this training today is used for the growth of the industry. We are indeed grateful.

by Patoma Admin — August 13, 2021 in Insurance 0

Faces @ AIICO sponsored training for Insurance, Pension Correspondents in Lagos

AIICO Insurance sponsored a one-day training programme for National Association of Insurance &Pension Correspondents, NAIPCO in Lagos.

CAPTION

L- Training facilitator, Head, Investment Relation Department, Mr.Moyo Onanuga, AIICO Insurance PLC, President, National Association of Insurance and Pension Correspondents (NAIPCO. Mr Chuks Okonta) and Head, Strategic Marketing and Corporate Communications, Mr. Segun Olalandu of AIICO during a training workshop organised by AIICO for NAIPCO in Lagos today.

by Patoma Admin — August 12, 2021 in Insurance 0

Unitrust Insurance delivers on key metrics as it clocks 35 years

Unitrust Insurance Company Limited, has delivered on outstanding performance across key metrics as it clocks 35 years.

The Managing Director/Chief Executive Officer, Mr John Ijerheime, while speaking on the 35 years anniversary, said the firm is a service-oriented company desirous of an intimate relationship with its customers by understanding the risk exposure inherent in their businesses and proffering solutions.

“Our approach is simple and does not Premise itself on any assumption, we operate in line with the core business ideals and values thereby satisfying our numerous customers. Unitrust prides itself on operational excellence which can be directly attributed to our highly competent work force,” he said.

He posited that the company’s business is driven by process digitalization and products innovation, stressing that Unitrust Insurance Co Ltd offers the right impetus for business growth.

Speaking on the companies performance in year 2020, he noted that the firm closed the year with a Gross Premium Written (GPW) of N3.98 billion, representing a year-on-year growth rate of 13 per cent during the corresponding period of 2019.

He maintained that the firm’s Profit After Tax (PAT) for the year stood at N747.172 million against recorded in 2019 and that in the same vein, the company’s underwriting profit improved significantly as the total of N802.194 million achieved from N 301.759 million reported in the 2019 financial year. The claims paid for the year was N1.08 billion, he said.

“Indeed, 2020 was a year that will be remembered for its unprecedented disruptions, which were primarily attributed to the COVID-19 pandemic and its multidimensional impacts on global economies. Yet, in the face of prevailing circumstances the Company delivered impressive results during the year,” he added.

He noted that the company’s business growth model is driven by structural analysis of its strengths, weaknesses, opportunity, and Threats (SWOT) for responsive branding , irrespective of the challenging situations, stressing that the company had by the result, demonstrated its robust capacity and sustainable execution of its strategic growth plans.

Founded in 1981 whilst commencing service in 1986, Unitrust insurance was authorized by Corporate Affairs Commission RC- 42899 and National Insurance Commission (NAICOM) to effect and carryout contracts of general Insurance business under the following categorization; Motor, Marine & Aviation, Personal Accident &Travel Medical Assistant, Workmen Compensation/Employers Liability, Public/products Liability, Bonds, Burglary, Goods-in-Transit, Fidelity Guarantee, Professional Indemnity and Directors/ Occupiers Liability.

by Patoma Admin — August 12, 2021 in Insurance 0

Airport concession not for State governments

By Favour Nnabugwu

Minister of Aviation, Senator Hadi Sirika has declared the concession exercise of the Federal government is open to all qualified entities but not for State governments.

Sirika said no sub-national government will be allowed to participate in the concession of the nations four major international airports.

He made this known earlier today during a virtual stakeholder’s meeting to update on the concession of the four international airports: Mallam Aminu Kano International Airport, Murtala Muhammed International Airport, Port Harcourt International Airport and Nnamdi Azikiwe International Airport.

The Minister who was responding to reactions from presentations at the conference also said that the nation’s airports will not lose staff as by ICAO statistics Nigeria was short handed with regards aviation personnel and so many will be redeployed as government has taken responsibility for other state-owned airports.

Sirika who presented an argument on why states will not be allowed to participate in the concession said government was trying to remove the airports from the national government to private entities and will not be handing over to a sub-national government.

He said,”What I can say emphatically, is that no state government will be allowed to participate to get this concession because the argument is, we are taking this concession from federal government to private sector, we cannot give from one government to another government, in fact to a lesser government which is a sub national, this will not happen but any private sector any private entity with proven record that is able to demonstrate will be allowed to participate and the best will emerge.

Reacting to Mr.Aliyu Mustapha on whether the Organised Private Sector of Kano can participate in the process, Sirika assured that it was quite possible if the organization had the technical capacity, foundational capacity as well as the experience and expertise as will be proven during the process.

He said,”This process (Concession) is for anyone that has the capacity, the technical capacity, the foundational capacity, the experience, the wherewithal and is interested to participate”.

“So whether you are organized private sector or a private entity you are free to participate so long as you can prove within the process that you can give us value for our money you can participate in the process you will be allowed”.

“It is going to be transparently done, this is the beginning of the process and we are in the planning, so now we are beginning the steps that would lead to the concession and it would be on our website, it would be on the website of ICRC so they can begin to organize themselves now either as a group or as an entity to participate in the process and you’d be certainly allowed to do so,” he said.

On loss of jobs, he said the workers’ rights and privileges will be protected

Unions fear for jobs but i keep saying they will not lose their jobs because number one: we currently by the findings of ICAO, we are understaffed in so many areas and we need to recruit people so we need all hands to manage our airports,

“Second: we have now increased the number of airports within our care, we are taking over Gombe, Bauchi, Dutse, Kebbi, Osubi and many other airports and we need helping hands, we need new people to manage the airport that being the case we look at what is the staff strength and how do we employ more people.”

by Patoma Admin — August 10, 2021 in Aviation 0

Only terminal buildings will be concessioned – Minister

By Favour Nnabugwu

The Minister of Aviation, Senator Hadi Sirika said that only the terminal buildings in the four international airports marked for concession will be giving to private individuals to manage.

The four international airports are the Muritala Muhammed International Airport, Lagos, the Nnamidi Azikiwe International Airport, Abuja, Aminu Kano International Airport, Kano and the Port Harcourt International Airport, Port Harcourt.

Speaking during a virtual meeting with stakeholders in Abuja, the Minister said : “All other facilities at the airports and existing concessions outside the Airport Terminals will still be managed by Federal Airports Authority of Nigeria, FAAN”.

The Minister also said, “the concessionaire will sign service level agreements with FAAN and Nigeria Airspace Management Agency, NAMA, to ensure that airport operates efficiently, the service level agreement will cover the Runway, Taxiway, Security and Air Traffic Management”.

“The concessionaire will provide the investment required to upgrade the existing terminals, take over the new terminals and maintain them over a period of time to be determined based on financial assessment of each transaction”.

Sirika further explained that all existing concession agreements ” within the terminals would be inherited by the concessionaire and would be allowed to run its course before any review.Tariffs will be regulated in accordance with the procedures set in the concession agreement.”

“As regards the passenger Service and Security charges, the concessionaires and FAAN would share of the charges which would be paid directly to FAAN by IATA.”

Enumerating the services FAAN will continue to render, the Minister said FAAN would be required to provide manpower through AVSEC for security of both the Airside and Landside, ” however the concessionaire would be expected to provide and maintain landside equipment but FAAN would continue to provide and maintain Airside security equipment,” Sirika added

by Patoma Admin — August 10, 2021 in Aviation 0

Allianz net income hit €2.2bn in Q2 2021

By admin

Global insurer Allianz has announced a 46% rise in net income for the second quarter of 2021 to €2.2 billion, driven by an increase in operating profit across all of its business segments when compared with the prior year period.

Solid growth across the business in Q2 2021 has resulted in Allianz posting a quarterly operating profit of €3.3 billion, which is a year-on-year increase of almost 30 percent

For the half year period, operating profit jumped from €4.9 billion in 2020 to €6.7 billion this year, with growth again witnessed in all business segments.

Oliver Bäte, Chief Executive Officer (CEO) of Allianz SE, commented: “Allianz had a very good half-year and achieved double-digit growth in operating profit. Our products and solutions have seen healthy demand.

“During these past weeks, which have been marked by heavy natural catastrophes in Europe, I have been proud to witness the solidarity and outstanding engagement of so many Allianz representatives.”

Within the carrier’s property and casualty (P&C) unit, operating profit improved significantly year-on-year, reaching €1.4 billion in Q2 2021. Despite this part of the business experiencing a higher loss load from natural catastrophe events, an improved run-off result boosted the result.

This, coupled with the absence of losses related to the COVID-19 pandemic, saw the P&C insurance segment’s underwriting performance improve dramatically. Overall, Allianz’s P&C operation has reported a Q2 combined ratio of 93.9 percent, which is down on the 95.5 percent in the prior year period.

P&C total revenues jumped by 3.4 percent in Q2 2021 from the prior year period, reaching €13.9 billion.

For H1 2021, P&C revenue hit €33.6 billion, while the operating profit increased by 32 percent to €2.9 billion during the period, despite higher natural catastrophe losses. The P&C combined also improved for the half year, ending the period at 93.4 percent, compared with 96.7 percent a year earlier.

Giulio Terzariol, Chief Financial Officer (CFO) of Allianz SE, said: “I am pleased by the continuous focus on underwriting discipline and productivity in our Property-Casualty business segment. Our balance sheet is strong and we are a reliable partner for our customers.

“While we witnessed in the second quarter a high level of natural catastrophes which continues in the third quarter, I am confident in a healthy operating profit contribution of the Property-Casualty business segment to the Group results.”

Turning to life and health (L&H), and Allianz has reported that during Q2 2021, the present value of new business premiums (PVNBP) rose from €11.5 billion to €19.7 billion. At the same time, the new business margin (NBM) increased slightly to 3.2 percent, as the value of new business (VNB) increased substantially year-on-year, to €633 million.

Within L&H insurance, operating profit moved from €1 billion in Q2 2020 to €1.3 billion in Q2 2021, driven mostly by the firm’s business in the U.S. which led to an improved investment margin.

For the half year period, PVNBP rose to €39.2 billion, operating profit increased to €2.5 billion, while the NBM and VNB increased to 3 percent and €1.2 billion, respectively.

“Our Life/Health insurance business is performing very well. Sales have been dynamic and I see a strong recovery across all our major markets. The value of new business is outstanding and we continue to manage actively our in-force business which is the basis for the sustainable operating profitability of the Life/Health insurance segment,” said Terzariol.

On the asset side of the balance sheet, Allianz has reported that third-party assets under management (AuM) increased by €56 billion in Q2 2021, when compared with the end of Q1 2021. Total AuM has risen by €2,488 billion in Q2 2021, driven by growth in all regions and across all asset classes.

“I am pleased that our Asset Management business segment continues to deliver very strong results with one of the best operating profit quarters in its history. Our focus continues to be on investment outperformance, net inflows and productivity,” said Terzariol.

by Patoma Admin — August 9, 2021 in Insurance 0

Ivory Coast: Insurers’ association lays out roadmap for the industry

By admin

The Association of Insurance Companies of Ivory Coast (ASACI) has drawn up a roadmap for the development of the insurance industry, under its new chairman Mr Mamadou GK Kone.

Mr Kone became ASACI chairman by acclamation on 29 April 2021 and will serve for a term of three years. He is also the managing director of Allianz CI Assurances Vie and Allianz CI Assurances TIARD.
In an exclusive interview with Financial Afrik, he said that the roadmap aims to:

Accelerate the rate of claims settlement and improving the quality of service

Search for new sources of growth to breathe new life into the insurance sector

Promote digital transformation of insurance processes to achieve operational excellence and therefore better serve customers.

Revitalise relations with the insurance regulator while strengthening the place of self-regulation in the industry

Reform of ASACI to make it an essential interlocutor for Ivory Coast, the regulatory authorities, the tax authorities and all other stakeholders.

As part of the roadmap, there is an action plan to develop the insurance sector in Ivory Coast. This is based on a 2021-2022 operational plan comprising 65 actions distributed through work teams made up of members of the ASACI executive board.

Mr Kone said that these work teams should rely on the ASACI’s technical commissions and the general secretariat. “This will require a reform of the operational structures of our umbrella to make them more efficient and more productive,” he said.

He also said, “We must first quickly reform our information systems and our organisational model to adapt them to the digital world. Our information systems and organisational structures are indeed heavy, old, or even unsuited to the agility required in the new customer relationship. We must therefore break down the “product” silos that characterise our companies to give more customer transversality to our actions.

“In this new approach, the keys to a successful customer experience are based on a series of actions, including that of making claims management an excellent lever for building customer loyalty and winning over customers, ” Mr Kone said.

“With regard to the member companies of ASACI, we say that the keywords to characterise our industry, in the era of the new customer, are co-construction, technology, training, agility and creativity

by Patoma Admin — August 9, 2021 in Insurance 0

Reinsurance market in Sub-Saharan Africa

By admin

The African sub-continent is scrambling around in an unstable economic and political environment. Monetary depreciations, inflationary pressure, unemployment and electoral periods have triggered too much turbulence of which insurance has suffered.

Nevertheless, some African economies remain sufficiently dynamic to generate growth. That is in particular the case of the Eastern part of the continent where we note that GDP growth rate is set around 6 percent in 2018 while growth in the overall Sub-Saharan African zone would to be set around 2.4 percentin 2019 and 2.5 percent in 2020.

Despite these constraints, the insurance and reinsurance market continues to progress. In 2018, non-life insurance premiums in Sub-Saharan Africa amounted to 16.9 billion USD where as life premiums attained 43.2 billion USD. Little more than 80 percent of these premiums being underwritten in South Africa.

Reinsurance premiums of this zone are steadily rising, going twofold between 2008 and 2018. Non-life reinsurance is growing more rapidly than non-life insurance in most markets.

With the exception of Gabon which has been sustaining a serious economic crisis since 2017, it is in Africa’s oil countries and those average-sized ones (Uganda, Senegal…) that reinsurance cession rates increase more rapidly than direct insurance premiums

In Sub-Saharan Africa, the poor volume of premiums generated by direct insurance companies and the creation of new reinsurance capacity are not helping the market. With reinsurance supply being superior to demand, ceding companies will continue to tap into favorable renewal terms for all the classes of business with the exception of energy and transport risks that are rated on the international markets.

Morocco and Algeria reported the lowest reinsurance cession rates, with 11 percent for the former and 22 perceny for the latter. In East and West Africa, cession rates are the highest with Uganda 51 percentand Tanzania 43 percent

Reinsurance companies technical results in West and Central Africa are generally positive with, however, a degradation of the loss ratio during the three recent years: 55.4 percent in 2014 against 60.3 percent in 2018. In this zone, corporate costs are relatively high whereas the combined ratio remains below 100 percent, 90.9 percent in 2014 and 98.9 percent in 2018.

It is noteworthy that claim costs have increased in recent years with a higher frequency, affecting operational margin.

The second remark pertains to the depreciation of local currencies which has tremendously impacted the cost of the claim.

This protection comes in the form of legal cession and establishment of local reinsurance companies.

Legal cession

In an effort to face international reinsurers, numerous Sub-Saharan countries have resorted to legal cession. This recourse plays out in two levels:

Direct insurance, for instance, with CICA Re benefiting as of January 1, 2020 from a 5 percent legal cession on all the premiums written in the CIMA space.

Legal cession may also be carried out at the level of reinsurance. In this case, national reinsurers or their likes shall benefit from a legal cession on all reinsurance treaties written in the region.

Establishment of national reinsurance companies

In order to retain the largest portion of premiums on the local market, Sub-Saharan States are promoting the establishment of local insurance companies that benefit from legal cessions. African reinsurers have retained a sizable portion of the premiums.

In the end, African reinsurers are underwriting 91 percent of their premiums in a single zone. This excessive concentration may, in the long run, strain reinsurers who are solely focused on Africa or a given African country.

by Patoma Admin — August 9, 2021 in Insurance 0

WAICA Re turnover up by 46% in 2020

By Favour Nnabugwu

WAICA Re has posted a turnover of 102.6 million USD in 2020 against 70.3 million USD in 2019, representing a 46 percent increase.

In 2020, the group based in Freetown (Sierra Leone) has recorded 31 percent of its premiums in Nigeria, 16 percent in Ghana and 11percent in Tunisia.

The portfolio is dominated by the property and casualty class of business with 40% of total premiums, followed by third party liability 19 percent, and engineering 11percebt.

Facultative risks account for 72 percent of 2020 acceptances. The net incurred losses stand at USD 30.5 million, a 63 percent growth compared to the 18.7 million USD reported in 2019.

The net income has gone up by 39 percent from 9.7 million USD in 2019 to 13.6 million USD a year later.

The company’s shareholders’ equity has reached 98.159 million USD compared to 89.37 million USD at the end of 2019. The return on equity (ROE) is 14 percent

by Patoma Admin — August 9, 2021 in Insurance 0