Cornerstone boosts industry profile with N11.5 billion premium
Cornerstone Insurance Plc has posted N11.5 billion Gross Premium Written (GPW) in 2018, boosting the sector’s financial performance.The Chairman, Segun Adebanji, who made the disclosure at the company’s 27th yearly meetings in Lagos, added that the company has continued to record growth in revenue, despite challenging market conditions.
According to him, the N11.5 billion, was an increase of 25 per cent from the previous year, with the largest contributor to this result being the Group Life portfolio, which contributed N2.01 billion (17 per cent of total GWP).He said the entire Life Insurance portfolio recorded a growth of 48 per cent from the previous year, stressing that this growth was driven by regulatory changes to Group Life Insurance pricing limits and the introduction of a new product targeted at retail segments and that the Individual Life Insurance portfolio grew by 370 per cent from the previous year (N621 million in 2018 from N132 million in 2017).
“The engineering, oil and gas product segments continued to dominate our General Business portfolio with a combined contribution of 57 per cent at N4.13 billion, giving credence to the emergence of Cornerstone Insurance as a leading Special Risks Underwriter.“A review of our overly prudent claims, reserving methodology during the year saw our Gross Claims Incurred for the year drop to N4.53 billion from N7.74 billion in the previous year, aligning more with the Industry average.
“In accordance with the provisions of IFRS 11, the completion of our Head Office building, which had been represented as a non-earning asset in our accounts, unlocked some value and contributed N2.31 billion to the Group’s profit.“Nonetheless, the board and management did not relent on the cost control measures put in place in the previous year, which helped reduced Operating and Personnel expenses by 13% from N3.09 billion in 2017 to N2.69 billion in 2018,” he said.
Adebanji posited that the cumulative effects of the strategic focus on the company’s key growth drivers resulted in a return to profitability in 2018, adding that Profit before Tax for the year 2018 stood at N2.66 billion after a period of losses.“NAICOM has, vide a Circular dated 20th May, 2019, taken the decision to increase the minimum paid-up share capital of Insurance and Reinsurance companies. As a composite company, this represents an increase of 260 per cent for Cornerstone Insurance and for our General Insurance subsidiary, FIN Insurance Company Limited, it represents a 300 per cent increase,” he added.
He noted that in line with NAICOM’s mandate, the Board of Directors had met to consider the firm’s strategic options and a plan is in place to ensure that the firm continues to participate fully and actively in the Industry after the June 2020 deadline.He sought and got shareholders’ approval for the authorised share capital to increase from N7.5 billion, divided into 15 billion ordinary shares of 50 Kobo each to N20 billion, divided into 40 billion ordinary shares of 50 kobo, by the creation of additional 25 billion ordinary shares of 50 Kobo each, and such new shares ranking pari passu in all respects with the existing in the share capital of the company.
The Coordinator Emeritus, Independent Shareholders Association of Nigeria (ISAN), Sir. Sunny Nwosu, lauded the company for the outstanding performance, while appealing to the board to give priority to minority shareholders in the course of the recapitalisation.On a general note, he urged insurance operators to form a lobby group that will always help canvass the wellbeing of insurance practice.
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