Steady progress at UA in 2017
View(s):Union Assurance PLC (UA) reported steady progress in 2017, recording Rs. 10.1 billion gross written premium, a 22 per cent growth compared with the previous year.
Regular new business premiums grew by 25 per cent compared to the previous year and UA was the third largest new business producer with the highest growth amongst the top seven players in the industry for the year, the company said in a media release.
UA recorded a profit after tax (PAT) of Rs. 7.4 billion compared with Rs. 1.3 billion in 2016. The PAT included Rs. 3.4 billion one off surplus transfer from non-participating life fund and Rs. 188 million as UA’s share of profits from the general insurance business of Fairfirst Insurance Ltd.
Investment income recorded a 38 per cent growth, mainly due to increase in interest rates of government securities in the first half of the year and unrealised gains from equities, it said.
Net insurance benefits and claims increased by 75 per cent mainly due to increase in maturities and surrender payouts. “Maturity payouts are in line with UA’s contractual obligations and surrenders have increased due to the challenging economic environment. Underwriting and net acquisition cost increased by 28 per cent to Rs 1.8 billion due to an increase in GWP and changes in variable incentive structures. Other operating, administrative and selling expenses increased by 21 per cent to support growth,” the release said.
As a result of the above, as at December 31 2017, UA’s life fund stood at Rs. 29 billion, a 4 per cent decrease from previous year. UA maintained a capital adequacy ratio (CAR) of 352 per cent indicating the financial strength of the business. The minimum regulatory requirement is 120 per cent with a regulatory intervention CAR of 160 per cent.