Veritas Kapital Assurance Plc recorded a pre-tax loss of N3.64 billion for the nine months ended September 30, 2026, compared with a pre-tax profit of N4.88 billion in the corresponding period of 2025, as rising claims and reinsurance costs weighed on underwriting performance.
Despite the earnings setback, the insurance company strengthened its financial position, with total assets growing by 54% to N54.56 billion from N35.40 billion, while shareholders’ funds increased by 60% to N30.59 billion.
According to the company’s unaudited financial statements, the group’s loss after tax (LAT) stood at N3.84 billion, compared with a profit after tax of N4.12 billion in 9M 2025.
This occurred as gross premium written fell 15% to N15.87 billion from N18.68 billion, while insurance revenue declined 6% to N15.41 billion from N16.31 billion.
CEO’s comments:
Commenting on the results, the Managing Director/Chief Executive Officer, Dr. Adaobi Nwakuche, said:
- “Our nine-month performance reflects notable developments in our financial position, particularly the growth in our asset base, equity position and investment income.
- “As we continue to build on these gains, our focus remains on strengthening our core insurance business, enhancing operational efficiency and improving overall business performance.
- “Our commitment to meeting our obligations to policyholders remains central to our business as we work towards delivering sustainable value to all stakeholders.
Key highlights (9M 2026 vs 9M 2025)
- Gross premium written: N15.87 billion (-15% YoY)
- Insurance revenue: N15.41 billion (-6% YoY)
- Insurance service expenses: N10.71 billion (+101% YoY)
- Claims paid: N8.25 billion (+196% YoY)
- Net expense from reinsurance contracts: N7.39 billion (+68% YoY)
- Insurance service result: N2.68 billion loss
- Net investment income: N3.51 billion
- Other operating expenses: N5.16 billion (+6% YoY)
- Profit before tax (PBT): N3.64 billion loss (vs N4.88 billion profit)
- Profit after tax (PAT): N3.84 billion loss (vs N4.12 billion profit)
- Basic earnings per share: -28 kobo (vs 30 kobo)
- Total assets: N54.56 billion (+54%)
- Shareholders’ funds: N30.59 billion (+60%)
Driving the numbers
One of the most notable developments in Veritas Kapital Assurance’s nine-month performance was the expansion of its asset base and shareholders’ funds, even as rising underwriting costs pushed the company into a loss.
Stronger capital position and growing investment portfolio
Total assets increased by 54% to N54.56 billion, supported by growth in investment securities and cash balances.
- Investment securities held at amortised cost more than doubled to N25.64 billion from N12.45 billion, with government bonds accounting for N24.87 billion of the closing balance.
- Cash and cash equivalents also increased to N10.17 billion from N7.98 billion, reflecting a stronger cash position at the reporting date.
- Shareholders’ funds rose by 60% to N30.59 billion, supported by a N15 billion private placement.
- Consequently, share capital increased to N14.43 billion from N6.93 billion, while share premium rose to N8.16 billion from N663.6 million.
The capital injection represents a significant development for the company’s financial position, providing a stronger equity base even as accumulated earnings came under pressure.
- Retained earnings moved from a positive N1.56 billion to a deficit of N2.73 billion, highlighting the impact of the period’s losses.
Investment income provides support
Another positive development was the 34% increase in net investment income to N3.51 billion from N2.61 billion.
- The growth demonstrates the contribution of the company’s investment activities to its overall financial performance.
- Net investment income included N764.3 million in interest income, N2.95 billion in other investment income and a N290.3 million net fair-value gain, partly offset by a N493.1 million net foreign exchange loss.
A significant component of other investment income was an N2.01 billion RSA asset-based fee.
- Interest on statutory deposits contributed N477.3 million, while short-term deposits generated N437.1 million.
- Treasury bills and dividend income contributed N8.7 million and N14.4 million, respectively.
These income streams provided an important cushion against underwriting losses, although they were insufficient to offset the combined impact of claims, reinsurance expenses and other operating costs.
Claims and reinsurance costs weigh on underwriting performance
The main challenge during the period came from insurance service expenses, which increased by 101% to N10.71 billion from N5.33 billion.
- Claims paid rose by 196% to N8.25 billion from N2.78 billion, accounting for much of the increase in underwriting costs.
- In contrast, acquisition costs and amortisation were relatively stable at N2.46 billion, compared with N2.55 billion in the corresponding period.
This indicates that the deterioration in underwriting performance was driven principally by higher claims rather than increased customer acquisition spending.
- As a result, the insurance service result before reinsurance declined by 57% to N4.70 billion from N10.98 billion.
Reinsurance costs added to the pressure.
Reinsurance premiums allocated increased to N9.05 billion from N8.40 billion, while recoveries from reinsurers declined to N1.67 billion from N3.99 billion.
- Consequently, net expenses from reinsurance contracts rose by 68% to N7.39 billion from N4.40 billion, resulting in an insurance service loss of N2.68 billion.
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