• Friday, April 12, 2024
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Law Union and Rock grows shareholders’ funds by 11.95% Q3

Inability to offer credit, insurance services is a major challenge for PSB – Fatokun

Underwriting firm, Law Union & Rock Insurance Plc has continued its growing trend as shareholders’ fund increases by 11.95 percent from N6.62 billion in third quarter 2019 to N7.41 billion in third quarter 2020.

The company achieved this despite a marginal drop in top-line, having tamed management, reinsurance and net benefit claims costs.

Total Assets also increased by 8.01 percent year on year from N12.4 billion in 2019 to N13.4 billion in 2020. The company posted

A marginal decrease occurred in topline by 1.52 percent from N4.2 billion in 2019 to N4.1 billion 2020, and a reduction in management expense of 5.22 percent, representing a drop from N987 million in the previous year to N935 million.

This shows a clear reflection of efficiency in asset utilization and management cost control.

Meanwhile, Underwriting Profit grew to N768.7 million from N732.5 million in 2019, representing a 4.94 percent increase in underwriting performance for the period. Insurance contract liabilities grew marginally as well, by 3.46 percent from 4.31 billion in 2019 to 4.46 billion Q3 2020.

On the other hand, Investment Income dropped to N457.31 million from N666.38 million in the previous year. This is due to the falling rates in the money markets, which is a continuing trend in the immediate term.

However, investment properties grew by 28.88 percent from N1.4 billion to N1.81 billion, representing a long term return on investment yield for the company at an appreciable time.

Further analysis showed that the company achieved 26 percent growth on Return on Assets, 48 percent Return on Equity and over 100 percent of Premium Written was earned, resulting in a 7 per cent margin on profit.

Ademayowa Adeduro, managing director commenting on the performance said the management adopted cost curtailment strategy in the quarter in the face of impacts of COVID-19 on the economy and the fiscal and monetary policies on investment yield.

He stated that they intend to do better, as Q4 is a leading indicator for the industry when it comes to business renewals, so Law Union will continue to grow. He reiterated the intent of the management to continue to improve performance going into the final quarter of 2020, to ensure a strong closure for the year, noting that all indices are good and indicate the company is healthy and growing.