Cynthia Ezekwe
The recently released 2023 full year financial report of Leadway Assurance Limited shows a mixed bag of outcomes in one of Nigeria’s leading insurers.
For instance, despite a strong showing by the company’s investment portfolio, its underwriting income took a hit due to substantial claims arising from its engineering and oil and gas business lines, as well as the effects of naira devaluation.
The combined impact of these factors resulted in a significant decline in underwriting income by N20.7 billion, highlighting the tough business environment faced by the company during the year.
According to the composite insurer, the company’s total investment portfolio stood at N556.9 billion as at 31 December 2023, an increase from N417.0 billion it recorded in 2022. The company’s investment portfolio was dominated by local currency government bonds, which accounted for 59.4 per cent of the investment portfolio.
The insurer’s capital base was significantly boosted by substantial unrealised foreign exchange gains of N68.2 billion from its net asset foreign currency (FCY) position as at the end of 2023.
Leadway also disclosed that it has extended its reach into the West African market, growing its operations in Cote D’Ivoire through two subsidiaries: Leadway Vie (life insurance) and Leadway IARD (short-term insurance). These subsidiaries, according to the insurance firm, collectively contributed 9.4 percent to Gross Written Premiums (GWP) in 2023, representing a 1.8% increase from their performance in 2022, with growth primarily driven by the non-life business segment.
Leadway’s strong capitalisation is supported by good earnings generation and retention and is evidenced by shareholders’ funds of N144.3 billion as of 31 December 2023.
In response to Leadway’s remarkable financial performance, GCR Ratings, a leading ratings agency in Africa, has forecasted a continuous growth trend for the company over the next 12 to 18 months.
“Over the next 12-18 months, we expect continued growth in the premium income to maintain Leadway’s leading position in the Nigerian market, supported by a wide distribution network, product drive and strong brand,” GCR Ratings noted.
