Covid-19 Hits NEM Insurance Income As Profit Drops By 45.29% To N1.11bn

NEM Insurance Plc’s profit slumped 45.29 per cent in the third quarter of 2020, as the Covid-19 pandemic led to slump in activities across the sector.

The decrease by 45.29 per cent represents a N930m shortfall in the profit of the Lagos based firm to N1.11bn.

This is against the N2.04bn recorded in the third quarter of 2019.

The insurance firm said in its financial report for Q3 that profit before tax also fell by 45.3 per cent to N1.32bn, from N2.42bn recorded in the third quarter results of 2019.

Insurance companies were faced with the fallouts in health, travel and business interruption claims, pressure from reduced business activities arising from the pandemic.

Despite the impact of the pandemic on profit, NEM’s Gross Premium grew by 14.41 per cent to N18.76bn from N16.40bn in the corresponding quarter of 2019.

The company’s net asset also rose marginally by 2.30 per cent to N14.4 per cent in the third quarter, against the N14.08bn in 2019.

Nigeria’s insurance sector has been hit by insurance claims from non-operation of businesses tied to the Covid-19 induced lockdown.

Recently, following the arsons from the hijacked EndSARS protest against police brutality in Africa’s most populous country, experts say they are of the opinion that the sector may need government aid to cover the resulting massive insurance claims.

Despite the shaky profit, the company’s Net assets added N324m to N14.4bn, from the N141bn recorded in the corresponding period of 2019.

The growth represents 2.30 per cent of the N14.1bn reported in Q3 last year.