The African Reinsurance Corporation (Africa Re) recorded an 8.5 percent increase in Insurance Service Revenue to $664.8 million in the first half of 2026, despite a significant rise in claims and a challenging foreign exchange environment.
The reinsurer’s unaudited financial results for the six months ended June 30, 2026, showed that its Insurance Service Result rose by 4.7 percent to $101.7 million, while the underwriting Combined Ratio remained below 85 percent at 84.7 percent.
Africa Re said the performance reflected broad-based growth across its business, supported by new business and stronger renewal retention across most of its profit centres.
However, incurred claims increased by 26.6 percent to $358.9 million during the period following several large losses. The impact was substantially mitigated by the Corporation’s retrocession programme.
Recoveries from retrocessionaires surged by 152.4 percent to $68.9 million, while the net expense from retrocession contracts held fell sharply by 67.9 percent to $20.2 million, compared with $62.9 million recorded in the corresponding period of 2025.
According to Africa Re, the protection provided by its retrocession arrangements helped cushion the impact of the heavier claims burden and enabled the company to maintain a strong underwriting performance.
The Insurance Operating Result consequently increased by 14.9 percent to $79 million, while the Net Reinsurance Finance Charge declined by 20 percent to $22.7 million, benefiting from a more supportive interest rate environment.
Despite the improvement in its insurance operations, Africa Re’s Net Result declined by 6.1 percent to $96.7 million.
The Corporation attributed the decline entirely to a $19.6 million net foreign exchange loss arising from currency depreciation across several of its operating markets, rather than deterioration in the underlying quality of its insurance portfolio.
Africa Re’s investment portfolio also contributed positively to its first-half performance, with Net Investment Income rising by 8.4 percent to $54.6 million.
Recurring investment income from interest, dividends and rentals increased by 8.5 percent to $44.2 million, providing the bulk of the investment earnings during the period.
The Corporation also recorded $9 million in market-related gains from active portfolio management, despite volatility associated with geopolitical tensions.
Return on Investment, however, moderated to 2.72 percent from 2.85 percent at the end of the corresponding period, reflecting the broader investment environment.
The reinsurer further strengthened its balance sheet during the period, with shareholders’ equity increasing by 3.3 percent from the end of 2025 to $1.44 billion.
Total assets rose by 7.5 percent to $2.33 billion, while total liabilities stood at $887.1 million.
Africa Re said its financial assets of $1.96 billion provided substantial coverage for its reinsurance liabilities, supporting its capacity to withstand market and claims volatility.
The Corporation also maintained financial strength ratings of A (Stable) from both AM Best and S&P Global Ratings.
Commenting on the results, Corneille Karekezi, group managing director and chief executive officer of Africa Re, said the Corporation had delivered a strong first-half performance despite a demanding claims environment.
He said the growth in Insurance Service Revenue across most profit centres, combined with disciplined underwriting and effective retrocession protection, helped the company absorb the impact of several large losses.
Karekezi noted that the decline in Net Result was driven by currency movements rather than any deterioration in the quality of the company’s portfolio.
“With a capital base of $1.44 billion, ample liquidity and continued strong ratings, the Corporation is well positioned to support its cedants and to deliver sustainable value to shareholders through the remainder of the year,” he said.
Africa Re said it would maintain its 2026 targets, with management expecting further revenue growth as renewal retention improves across its core African markets and selected international portfolios.
The Corporation said it would continue to focus on underwriting discipline, portfolio optimisation and prudent investment management, while closely monitoring claims development, currency movements and geopolitical risks in the second half of the year.
Nigeria’s ports’ new referee must know when to blow the whistle