Continental Re profit falls; CEO remains positive
Continental Reinsurance, Africa’s largest private reinsurer outside of South Africa, saw a fall in profits for the second quarter of 2014 driven by an adverse claims environment.
The reinsurer’s profits fell by 18 percent to N1.1 billion ($6.7 million), compared with N1.4 billion in the second quarter of 2013 as a result of reduced underwriting profit.
Its underwriting profit reduced by 29 percent to N786.8 million from N1.1 billion mainly due to worse claim experience as indicated above.
The reinsurer’s combined ratio deteriorated to 98 percent, compared with 83 percent in the same period of the year before.
Despite this, the company’s gross premium income grew to N8.6 billion in the quarter, a 9 percent rise compared with N7.9 billion in the second quarter of 2013.
“Growth continues to outpace the market, even in the face of growing competition and more scrupulous risk selection, due to the positive impact of our strengthening brand position in the market,” said the reinsurer.
Dr. Femi Oyetunji, group chief executive officer of Continental Re, said: “We have had a successful half year in which we have seen volume growth from our regional offices contributing positively to the Group’s market share across our chosen markets in line with our strategy. Despite the relatively adverse claims experience impacting negatively on underwriting profit, we still see strong growth opportunities and are optimistic of an improvement in key indices by the end of the year.”
