Sanlam Kenya has reported an expected decline in net profit for the period ended 31st December, 2021. The projected decline in earnings follows the company’s record of low numbers in 2020. This means that the company’s losses will decline further, below the Ksh. 78 million that was earlier reported.

Similarly, its half-year earnings decreased by Ksh. 291.8 million up from a Ksh. 99.1 million loss posted in the same period in 2020. The firm attributes the loss to provisioning on settling high claims and the one-off forex losses.

“Based on our un-audited end of year financial results and information currently at the Board’s disposal, we wish to report that our projected net earnings after tax for the period ended 31st December, 2021 will reflect a declining compared to the prior-year earnings. The prolonged Covid-19 pandemic negatively impacted various aspects of the economy including our business. Both corporate and retail segments were adversely affected by increased premium default and claims from COVID-19 fatalities,” said Dr. John Simba, Sanlam’s Board Chair.

Dr. Simba further noted that the provisioning approach applied by the business is the key contributor to the decline in earnings. He added that this trend is expected to reverse as the operating environment improves over the next financial year.

Sanlam posted an underwriting loss of Ksh. 188.77 million as per the Insurance Regulatory Authority (IRA) report for the 9 months ending 30th September, 2021. In the period, net claims stood at Ksh. 142,092, its market share at 2% while the claims ratio stood at 92%.