Janashakthi records Rs 209.5 mn profit for 2005 financial year

Janashakthi Insurance Co. Ltd last week reported a sharp rise in the company’s profits to Rs. 209.5 million for the financial year ending December 31, 2005, which is a stunning 324% growth in profitability over the previous year, and said it has retained its position of the third largest insurer.

Picture shows Chairman Janashakthi Insurance Ltd W.T. Ellawala handing over the letter of appointment as Managing Director to Prakash Schaffter (centre). Also in the picture are (left to right) Dayalini Abeygunawardena, Deputy General Manager Insurance, C.T.A. Schaffter, Deputy Chairman and Priyanthi Kuruppu, Deputy General Manager Finance.

“We are pleased to report with satisfaction our Group and Company profits of Rs.209.5 million and Rs 45.6 million for 2005, which we hope will be viewed by all stakeholders as a testimony to our corporate resilience, as well as the unflagging dedication of our staff at all levels in the field and office. We have also retained our position as the third largest general insurer in Sri Lanka by a wide margin,” Janashakthi Chairman W.T .Ellawala said in a statement.

The total revenue reported was Rs. 3,863 million up by 32.6% from Rs. 2,913 million in 2004. Income from investments grew by 39% in 2005 to reach Rs.766 million.

Janashakthi’s General Insurance sector recorded a gross written premium of Rs. 2,888 million, an increase of 16% over last year, with the most significant contribution being from the motor Insurance business. Despite fierce competition which continues to pervade this market, the Company reported an increased underwriting profit of Rs.216 million in 2005 a commendable improvement even after discounting the impact of tsunami claims in 2004 compared to the loss of Rs. 74 million previously.

The company’s total Life business premium grew significantly by 22% to Rs. 814 million from Rs. 666 million the previous year, while the first year’s premium grew by 29%.

The Life Fund increased by Rs. 254 million in the year 2005 with the total long term insurance fund at the end of the year reaching 1.977 billion. “We continue to vigorously address the vexatious issue of the unduly high rate of lapsation of Life Policies and have been fairly successful in our efforts to arrest this trend”, Managing Director C.T.A. Schaffter, who quit from all executive functions, said. Among the company’s innovative services is the Full Option Call Centre which operates 24 hours x 365 days and assists motor policy holders by arranging for immediate inspection of vehicle damage and authorizing repairs, obviating delay in obtaining Police Reports and awaiting processing of their claims by the Motor Insurance Division.

As the leader in innovation, Janashakthi introduced the Zero Interest Plan end 2005, for the benefit of policy holders, especially Motor, who find the lump sum annual payment a strain on their finances. Under this plan, policy holders use their Credit Cards to make premium payments in monthly installments at a zero interest. This concession has met with much acceptance by policy holders. In addition the company embarked on an aggressive innovation drive by concept testing a number of new product solutions for implementation in 2006.