Africa Re has recorded a Gross Written Premium of US$1.106 billion, indicating an annual growth of 16.25 percent that surpasses most recent forecasts for 2023, based on preliminary and unaudited figures under IFRS4.
The company attributed the growth to successful marketing efforts, leading to new business acquisitions, improved market prices, strong reinsurance demand, and moderate economic growth in its core markets.
A Gross Written Premium of US$1.199 billion would have been achieved translating to almost 25.92 percent growth at a constant exchange rate by the end of 2022.
Due to the reinsurer’s excellence in underwriting, price adjustment, and diversified portfolio, it was able to achieve a strong underwriting performance.
Its risk appetite and retrocession protection arrangements are exemplified in the impact of some natural catastrophes, especially the earthquakes in Türkiye and Morocco, as well as other major losses reported in 2023.
The management said, “As (re)insurers, we are in the business of paying claims and this is part of our responsibility to all stakeholders. This strong underwriting result translated into an improvement of the Net Combined Ratio to 93.51% (2022: 94.45%) and a Net Underwriting Profit of US$ 54.806 million (2022: US$ 40.999 million), an improvement of 33.68 percent.
“The Investment and Other Income achieved in 2023 was US$ 73.873 million compared with US$ 13.124 million in the previous year. The recovery from the capital losses recorded in 2022 and the high-interest rate environment resulted in an improvement of 462.88 percent”.
Commenting on the firm’s performance, Group MD/CEO, Dr. Corneille Karekezi, said, “The milestone achievement in gross written premium at US$1 Billion recorded in 2023 is a psychological victory for Africa Re, especially as this milestone was initially to be crossed within or at the end of our 2014-2018 strategy horizon.
“As we report our financial statements in US Dollars, and the vast majority of our business is originally denominated in African currencies, growing the topline has been more challenging than we expected.”
“Crossing that milestone is a testimony of the resilience of the Corporation in the face of the continuous depreciation and devaluation of our operating African currencies against the US$ since 2015, as well as other macroeconomic challenges including geopolitical tensions, low economic growth and sovereign debt crisis.
“For example, at stable exchange rates of 2011, 2012, and 2013, the Corporation would have surpassed the US$ 1 Billion milestone in 2017. It is better late than never, and this reaffirms Africa Re as an African success story.”
The company recorded a Net Income of US$129.145 million compared with US$23.733 million in 2022, showing an improvement of 444.16 percent.
Based on the assessment of rating agencies, the capital position of Africa Re remains at the strongest levels with a growth of 6.95 percent in Shareholders’ Funds, and this has restored the Return on Average Equity to double digits of 12.59 percent, compared with an average of 5.16 percent recorded from 2018 to 2022.
Furthermore, Dr. Karekezi said “2023 is the best year in our history based on the net income. As we celebrate our 48th Founders Day in February 2024, we remain grateful to our founding fathers, hardworking colleagues, and strategic partners for their commitment and support as well as our customers for their continued trust in Africa Re.”
The African Reinsurance Corporation (Africa Re) is a leading reinsurance company headquartered in Lagos, and as a premier reinsurer of the African continent, it boasts one of the highest premium income volumes and the strongest financial strength ratings.
Africa Re mission is to foster the development of the insurance and reinsurance industry in Africa, to promote the growth of national, regional, and sub-regional insurance risk underwriting and retention capacities, and to support African economic development.
Africa Re, as the leading reinsurance company in Africa and the Middle East, offers a unique value proposition across Africa and in selected markets of the Middle East, Asia, and Brazil, backed by a diverse pool of talent and expertise, unique market knowledge, proximity to clients, strong financial ratings (A / Stable by AM Best and A – / Stable by S&P), privileged access to African markets, and excellent customer service.
Established in 1976, Africa Re is a pan-African financial institution with a broad-based shareholding split between African (75%) and non-African (25%) investors.
African shareholding comprises 42 African Member States, the African Development Bank (AfDB), and 113 African insurance/reinsurance companies from the 42 African member countries.
Africa Re’s core market coverage is achieved through offices located in key cities: 6 regional offices (Lagos, Casablanca, Abidjan, Nairobi, Ebène -Mauritius-, Cairo), 3 representative offices (Addis Ababa, Khartoum, and Kampala), and 3 fully owned subsidiaries in Johannesburg (Africa Re South Africa), Cairo (Africa Retakaful Company) and Dubai (DIFC Underwriting Management agencies.