FBS Re records 110% increase in GWP …To expand beyond Anglophone countries

By Favour Nnabugwu




FBS Reinsurance Limited, (FBS Re) has surpass the expectations of growing concern for a company that is just years in the market to record a sterling performance of 110 percent increase in Gross Written Premium, GWP

In the Company’s 2022 financial report released at its 2nd Annual General Meeting (AGM) held recently in Abuja, FBS Re grew its gross written premium by 110 percent to N16.589 billion from N7.906 billion recorded in 2021.

Its underwriting profit also grew by 545 percent from N813 million in 2021 to N5.244 billion, which according to the company was driven by prudent risk management and operating costs.

Chairman, Board of Directors, Alhaji Bala Zakariya’u who announced the performance at its AGM said FBS Re’s financial performance just in its second year of operation is a testament to the resilience of its applied business model.

Zakariya’u informed that FBS Re will be embarking on a guided expansion program into other markets and territories outside its traditional Anglophone Zones.

“This expansion will focus on Central, East and Southern African territories as we continue to study the North African markets.”

“Our risk appetite will determine the expansion initiative and ease of doing business in the selected territories. It will also be in line with the overall corporate objectives of sustainable profitability and delivery of better alternative services to African cedants

He said despite environmental challenges, the company gained positive results in the critical areas of market share growth and profitability.

Zakariya’u also revealed that the company achieved an investment income of N1.050 billion in 2022 financial year, as against N275 million in 2021.

Profit after tax rose to N2.491billion, a 544 percent increase from N387 million achieved in 2021, the Chairman further said.

Zakariya’u said, “I am particularly pleased to report that the results were achieved mainly by delivering better services to our cedants and brokers.

“We shall continue to keep our promises, as has been anointed in our name – ‘For Better Services’ and create sustainable value addition for all our stakeholders.

Territorial distribution of premium of the Company shows that Nigerian market contributed 69 percent of the total, followed by Ghana market with 17 percent, while Francophone and rest of Africa contributed 5 percent and 7 percent respectively.

Zakariya’u also noted that reinsurance is a capital-intensive business, accordingly the Board has prioritised raising adequate capital funding, to support the planned rapid market share growth.

FBS RE authorised and issued shares has been increased from N10 billion to N20 billion, and the Board has already commenced working with strategic investing partners to raise the needed additional capital.

Local airlines pay more for insurance over shortage of forex

L- The Chief Operating Officer of Ibom Air, Mr George Uriesi and the Managing Director of Aero Contractors, Captain Ado Sanusi
Local airline operators have said the shortage of foreign exchange is forcing operators to pay more for aircraft insurance and other services denominated in dollars.
The Chief Operating Officer of Ibom Air, Mr George Uriesi and the Managing Director of Aero Contractors, Captain Ado Sanusi, said operators were incurring more cost due to the continued depreciation of the naira against the United States dollar.
Uriesi at the third edition of the AviaCargo Chinet Conference 2023 held in Lagos.
In his presentation at the conference, the COO said the situation had led to high insurance premiums for the airlines and wondered how some of them were coping with the situation.
He stated that this was a major challenge to operators as aircraft and other equipment must be appropriately insured by the airlines before being deployed to service.
He further expressed how operators were facing difficulties in accessing dollars through the Central Bank of Nigeria official window
He said, “Insurance is a growing problem and because we cannot fly an uninsured aircraft we have no choice, but to hang in there and source for the dollars to do the insurance.
The losses we accumulated were mainly dollar-based components, when you are procuring dollars above the then CBN rate, you apply when it was N400 to a dollar and you get it at N680. The difference is a lot.
“Now, it is being floated and it is running faster. Recently, we bought a dollar for N915, but on the platform, it was put at N890. Today, it is N900 on the platform I’m sure when we are getting it, we would procure it at N950.
“The new style now is they tell you ‘give us cash and when we buy dollar we will give you.’ But, it delays, you ask for your cash back and they tell you that you wouldn’t get the dollar.”
“Then when they now have the $400,000 they will now tell you the price they got far exceeds what was paid and you need to add more. That is where we are now, I don’t know how other airlines are managing the situation.”
Also speaking, Sanusi, who is a former managing director of the Nigerian Airspace Management Agency, said, “The issue of forex for airlines has been there for a very long time, it’s just coming back because the naira to dollar exchange rate has gone up and then the availability too has become a bit scarce.
He said, “This is a bit due to because the CBN is trying to keep up to their commitment on the allocation of foreign exchange. For airlines, it’s a challenge but that doesn’t mean that you would fly the airplane without insurance cover, it’s illegal, you can’t do that, no pilot will fly an airplane without insurance and I believe those are the things that pilots check before they fly an airplane.”
According to him, “It’s left for NCAA to make sure that airlines are well insured and are not using insurance companies that are not recognised by the National Insurance Commission. I’ve been saying this for a long time that insurance is one of the biggest challenges for an airline, because of country risks and the likes, insurance companies are requesting for higher premiums and then when you come you have to pay foreign currency, this makes it very hard.”
The Nigeria Civil Aviation Authority, had on Sunday, warned airlines and allied aviation services against defaulting in aircraft insurance.