By Nse Anthony-Uko
(Sundiata Finance) — NEM Insurance Plc has reported nine per cent profit growth for the second quarter ended June 30, 2017. The company in its result released on the Nigerian Stock Exchange showed that profit after tax increased to N1.25 billion compared to N1.12 billion reported same quarter 2016.
Gross premium rose by 37.72 per cent to N8.12 billion for second quarter compared to N5.89 billion recorded same quarter 2016. The company’s reinsurance expenses was also increased by 84.72 per cent from N1.17 billion to N2.16 billion posted in the period under review.
Net underwriting income grew to N4.79 billion in contrast to N4.04 billion reported in the year 2016, while investment income also grew to N260.8 million against N178.7 million in 2016. Total asset for the period was N17.11 billion compared to N14.53 billion, total liabilities was N8.43 billion against N7.1 billion in 2016, while shareholders fund rose by 16.8 per cent to N8.68 billion from N7.43 billion in 2016.
Capital market analysts said that the result was very impressive considering the poor performance of the sector. They noted that the Nigerian insurer and others operate in a tough operating environment as weak regulatory framework, low awareness and public apathy towards insurance continue to undermine growth.
Capital market said that such under-performance and lack of market penetrating products explain why insurance stocks are not performance as expected. NEM Insurance started insurance business in Nigeria in 1948 through the agency of Edward Turner & Co.
It became a Nigerian branch of NEM General Insurance Association Limited of London in 1965 and incorporated in 1970 as a Nigerian company in compliance with the Companies Decree of 1968, the company became quoted on the NSE in 1989 following the privatisation by the federal government of Nigeria. The company, which has contributed immensely towards the growth of Insurance Industry in Nigeria, was into Life and Non- Life business.