THIRD QUARTER DIVE FOR AFRICAN ALLIANCE ASSURANCE.

A dive in its fortunes during the quarter to September 2015 has made unlikely that African Alliance Assurance PLC ended financial year to December with assurance officer good returns.
According to the figures released recently, the first two months of that financial year were not fantastic when compared to previous corresponding times but third quarter dive made it all worse.
In the nine months to September 2015, African Alliance only managed to close with about N1.25 gain on each N100 income generated (premium income plus others). This was no where comparable to the N9.61 gain on each N100 income by September 2014.
The main reason was that in the third quarter African Alliance lost N5.9 on each quarter N100 income compared to N32.4 gain during the previous third quarter.
The third quarter fortune was hit by 160.5% increase in overall claims to N3661.2m from N1405.4m; 105.1% dive in underwriting into N70.8m loss; leap in loss on financial assets to N29.4m from N5.52m and 28.7% increase in total overhead to N657.5m from N511m.
In the case of the full nine months to September overall claims growth was only 55.2% to N9046.2m from N5829.7m;  underwriting profit was recorded but down 55.7% to N759m from N1712.3m; and growth in overhead came to 20.6% from N1499.6m to N1808.5m.
The third quarter did better in some areas though particularly in investment income growth and increase in premium income.
While 33.4% rise in premium income was recorded in the third quarter to N4012.1m from N3007.1m the full growth for the nine months was 30.3% at N10847.9m from N8321.1m.
As for investment income growth the gap was wider. In the third quarter investment income came to N492.1m compared to N130.4m previously. On the other hand, compared to this triple figure, total investment income for the nine months increased by 105.1% to N1168.6m from N569.7m.
SO:
* Nothing much can be done about 2015 financial year now even though audited figures are not yet out. The outcome looks set like concrete
* However there is always another year for a going concern like African Alliance and this is hoping that the claims situation improves significantly and growth in administration expenses is kept in check.

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