November 15, 2021

General Accident Insurance Company Limited (GENAC), for the nine months ended September 30, 2021, reported Gross premium written of $11.50 billion, 23% higher than the $9.32 billion reported for 2020. Excess of loss reinsurance increased to $155.47 million, from $126.09 million reported in 2020 while Reinsurance ceded slightly increased to $8.99 billion relative to $7.21 billion in 2020. As a result, net premium written increased by 18% from $1.98 billion last year to $2.35 billion in 2021. Net premium written for the third quarter amounted to $821.18 million relative to $683.24 million booked for the corresponding period in 2020.

Net changes in unearned premiums totalled $117.38 million, relative to an earned premium of $40.63 million recorded the previous year. Consequently, net premiums earned grew by 10% to a total of $2.23 billion compared to $2.02 billion for the same period last year. For the quarter, net premium earned totalled $773.17 million compared to $667.52 million booked for the similar quarter of 2020.

Commission income grew by 38%, year over year, from $515.57 million in 2020 to $709.97 million in 2021, while commission expenses also went up by 13% from $346.03 million in 2020 to $391.88 million in 2021.

Claims expenses saw a decline of 15%, closing the period at $1.16 billion (2020: $1.36 billion), also management expenses climbed by 18% to total $1.03 billion (2020: $869.03 million).

Net changes in commission totalled a loss of $19.94 million for the nine months compared to gain of $32.87 million booked in 2020.

Consequently, underwriting profit for the period totalled $344.68 million, this compares to a loss of $6.19 million in 2020. The company made an underwriting profit of $175.72 million for the third quarter when compared to a loss of $27.41 million in 2020.

In addition, investment income closed at $147.62 million, a 5% increase when compared with last year’s $140.46 million, while other income totalled $71.97 million (2020: $108.76 million). Other operating expenses grew by 36% to $115.08 million when compared to $84.73 million in 2020.

As such, profit before taxation amounted to $441.94 million (2020: $155.59 million). Net Profit totalled $350.95 million for the period, a 182% increase when compared to the $124.64 million reported last year, subsequent to tax charges of $90.99 million (2020: $30.95 million). However, net profit for the quarter was $176.59 million versus net profits of $12.15 million twelve months earlier.

Profit attributable to shareholders amounted to $399.16 million (2020: $147.19 million). While for the quarter, Profit attributable to shareholders closed at $196.80 million (2020: $17.28 million).

Total comprehensive income amounted to $433.57 million (2020: $146.09 million) year to date. While for the quarter, total comprehensive income amounted to $200.62 million (2020: $39.79 million).

As such, earnings per share for the period amounted to $0.39 (2020: $0.14) while EPS for the quarter amounted to $0.19 compared to $0.02 in 2020. The twelve months trailing EPS is $0.48. The number of shares used in our calculations amounted to 1,031,250,000 units. The stock traded at $6.60 as at November 12, 2021 with a corresponding P/E of 13.76 times.

The company states, “Like all businesses, General Accident continues to be impacted by Covid-19. We are anticipating that with the increased vaccine take-up, some level of normalcy will return to the country. General Accident will continue to rely on our digital platform, along with our strong relationships with our clients, brokers, reinsurers, and employees to continue delivering our service.”

Balance Sheet at a glance:-

Total Assets increased by 3% to $11.19 billion as at September 30, 2021 from $10.86 billion a year ago. This was driven by the increase in ‘Due from Related Parties’ to total $334.82 million (2020: $11.66 million). Also, ‘Due from Policyholders, brokers and agents’ contributed to the increase closing at $1.46 billion (2020: $1.16 billion).

Shareholder’s Equity as at September 30, 2021 stood at $3.06 billion (2020: $2.67 billion) resulting in book value per share of $2.97 (2020: $2.59).

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