Linkage Assurance confident of meeting recapitalization obligation

The management of Linkage Assurance Plc has assured the shareholders of the company that all the necessary steps are being taken to meet the recapitalistion base as directed by the regulator of the insurance industry.

Specifically, Mr. Daniel Braie, Managing Director/CEO of the company stated that regardless of the challenge posed by the COVID 19 the underwriter would meet the new capital base of N10 billion.

Recapitalizing the company would be in compliance with the directive of the industry regulator, the National Insurance Commission (NAICOM), for operators in the insurance industry to shore up their capital bases.

NAICOM had given the insurance industry June 30, 2020, as deadline for operating insurance firms to comply with its new minimum paid-up share capital. The revised minimum paid-up capital for life will increase from N2 billion to N8 billion, general business from N3 billion to N10 billion, composite business from N5 billion to N18 billion and reinsurance from N10 billion to N20 billion.

The company in a statement on Tuesday, June 2, 2020 said that it was concurrently exploring all available options including a rights issue, private placement, and internal capital sourcing to shore up its capital base.

Reviewing the 2019 financial year, Braie said the company posted a Gross Written Premium (GWP) of N6.52 billion as against N5.39 billion during the same period in 2018, indicating a 21 per cent increase.

“From the business generated in 2019, the company also recorded a profit before tax (PBT) growth of 909 percent, moving from N135 million in 2018 to N1.36 billion during the review period.

“Profit after tax (PAT) also grew to N1.3 billion, a 553 percent increase from a loss position of N290 million during the same period in 2018,” he said.

According to him, underwriting profit rose by 153 percent to close at N409 million during the review period, as against loss position of N773 million the previous year.

Braie said that investment also grew by 10 percent, moving from N2.46 billion in 2018 to N2.71 billion in 2019.