Kenya Reinsurance Corporation (Kenya Re) has announced that its net profit has reduced by 13% to Ksh. 1.076 billion. In the same period in 2018, the company posted a Ksh. 1.23 billion net profit.
During the period however, the company posted a 40% rise in gross written premiums which stood at Ksh. Ksh 8.860 Billion as compared to Ksh. 6.332 Billion in 2018. The company attributes the rise in premiums to their investment in the agricultural business. Premiums in that sector stood at Ksh. 2.962 Billion.
The Corporation’s acquisition costs increased by 11% from Ksh 1.828 Billion to Ksh 2.028 Billion, attributed to the increase in the gross written premiums compared to the same period in 2018. Investment income for the period stood at Ksh 1.975.6 Billion which is 2% higher than the prior year (Ksh 1.940 Billion). Net claims incurred increased by 49% to stand at Ksh 4.995 Billion compared to Ksh 3.362 Billion in 2018. This increase is attributed to higher claims reported during the period compared to the same period in 2018.
Kenya Re’s total assets increased from Ksh 44.362 Billion as at 31st December 2018 to Ksh 45.828 Billion as at 30th June 2019 which is a 3% increase. Shareholders’ funds increased from Ksh 28.3 billion as at 31st December 2018 to Ksh 29.1 billion as at 30th June 2019 which is a 3% increase.
Speaking at the investor briefing Kenya Re Managing Director, Mr. Jadiah Mwarania cited some of the challenges the corporation faced during the first half of the year 2019. “Our challenges ranged from increased competition, premium undercutting, domestication of reinsurance business in some of our key markets and changing reinsurance treaty structures towards excess of loss as opposed to proportional treaties and devaluation of currency in some of our markets.” Said Mr. Mwarania.