May 6, 2021
IronRock Insurance Company Limited (ROC), for the three months ended March 2021, posted gross premiums of $198.65 million relative to $178.67 million booked in the prior corresponding quarter, this represents an 11% increase year over year.
Proportional reinsurance amounted to $142.38 million compared to $115.70 million recorded in the same period last year. While excess of loss reinsurance totalled $13.44 million (2020: $11.10 million). As a result, net premium amounted to $42.84 million relative to $51.87 million in the same period in 2020, a 17% decrease year over year.
Net earned premium adjustment closed the period under review at $5.65 million, compared to an unearned adjustment of $1.08 million booked in 2020, this resulting in net earned premium of $48.49 million for the three months period versus $50.80 million in the previous corresponding quarter.
Commission expense incurred totalled $24.76 million in contrast to 2020’s $20.73 million, while commission income earned grew by 43% from $19.56 million in 2020 to total $27.98 million for the three months ended March 2021.
In addition, the company booked net claims of $18.51 million relative to $27.62 million reported in the previous comparable quarter.
Operating expenses, for the three months period, decreased to $44.13 million relative to $45.06 million in the prior corresponding quarter. As such, underwriting loss improved over the period under review closing at $10.93 million versus a loss of $23.06 million in 2020. Management noted, “was primarily driven by top line growth, expense control, increased commissions earned and lower net claims.”
Investment income increased from $11.50 million in 2020 to $9.67 million for first quarter in 2021. No gain on sale of investment was recorded for the period under review (2020: $3.91 million). Foreign exchange gain amounted to $5.72 million compared to $4.83 in 2020, while other income rose to $7,000 (2020: $3,000).
As a result, net profit for the first quarter totalled $4.46 million compared to a loss of $2.81 million in 2020.
Earnings per share for the period under review totalled $0.021 (2020: LPS: $0.013). While, the trailing twelve months EPS is $0.258. The numbers of shares used in the calculations are 214,000,000 units. The stock price as at May 05, 2021 was $3.07 with a corresponding P/E of 11.90 times.
ROC stated, “During the quarter we launched a new motor product called Pay As You Drive (PAYD), which uses a device from Guardsman Group to assess your driving behaviour and give you premium refunds for good driving scores. It’s called Telematics Insurance, and IronRock is the first insurer in Jamaica to offer it. We see this as a first step in the inevitable progression towards smarter, data driven insurance.”
Balance Sheet Highlights:
As March 31, 2021, ROC’s total asset base totalled $1.45 billion (2020: $1.23 billion) increasing by 18% year over year. ‘Reinsurance Assets’ contributed to this increase from $298.08 million booked in 2020 to $386.68 million booked in 2021. ‘Securities purchased under resale’ and ‘Insurance and Other Receivables’ contributed to the rise with increases of $70.18 million and $63.39 million closing the period at $70.18 million (2020: nil) and $181.82 million (2020: $118.42 million), respectively. However the movement was offset by a $55.88 million reduction in ‘Investment’ to $604.04 million (2020: $659.93 million).
Shareholders’ equity closed at $572.63 million (2020: $481.07 million). This resulted in a book value per share of $2.25 (2020: $2.46).
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