Sovereign Trust Insurance Plc has confirmed its resolve to play in the elite clued of insurance market in Nigeria following its declaration last week to push its capital base to the N10 billion threshold.
The N10 billion minimum solvency capital will permit STI to operate as a tier one insurer under the newly introduced tier base capital structure by the National Insurance Commission (NAICOM).
When accomplished, the N10 billion working capital will enable STI to underwrite all classes of insurance business ranging from motor insurance to special risks category which comprise aviation, oil and gas including marine. The company will also be permitted to handle both personal and group life policies annuity inclusive.
Shareholders of the company had at its 2017 annual general meeting in Lagos approved a special resolution to raise the company’s capital from its current level of N7.5 billion to N10 billion through the creation of five billion ordinary shares of 50 kobo each. The additional capital would be raised through either special placement or public offer.
“It is important to state our company’s resolve to adequately operate in tier-1 category with the plan of increasing our capital base both organically and inorganically before the commencement of the Tier-based minimum solvency capital regime”, the company’s chairman Mr. Oluseun Ajayi had told shareholders at the meeting.
According to him, “The dynamism of the business environment will continue to pose its challenges and opportunities for operators, but our strength is always built on applying the right approaches and strategies capable of achieving optimal operational efficiency and performance. Sovereign Trust Insurance Plc is very well positioned to take advantage of the opportunities ahead”, Mr. Ajayi further declared.
The chairman had earlier informed shareholders that the company achieved a 33 per cent increase in its gross written premium as it grew from the 2016 figure of N6.3 billion to close at N8.5 billion in 2017.Net claims paid during the period under review showed an increase of 9.5 per cent as it moved to N1.44 billion as against the N1.3 billion in 2016.
The company he said recorded a pre tax profit of N202 million as against NN44 million in 2016 representing an increase of 351 per cent. Net profit stood at N157 million for 2017.“Similarly, our investment income rose by 41.6 per cent from N286 million in 2016 to N406 million in 2017. In addition, our total assets rose from N9.5 billion to N10.8 billion representing 13.7 per cent. The composition of our assets was well structured to position the company for better future performance Mr. Ajayi concluded.
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