Aureol Insurance Company (AIC) last Friday held its Annual General Meeting at the Atlantic Hall, National Stadium hostels in Freetown.
In his statement the chairman of the company, Dr Patrick Coker, said he was happy to welcome all to the company’s 20th Annual General Meeting which marked a watershed in the history of the company.
“As we celebrate our 20th anniversary, I would like to take this opportunity to congratulate all our stakeholders and to assure them that the company is in excellent health, focused and fit to take on the competition”, the chairman said.
The 2006 Gross Premium of the company was Le5, 456 billion as compared to Le4, 438 billion for the preceding year, which is an increase of 23%.
The claims incurred for the 12 months to 31st December 2006 was Le1, 413 billion which is an increase compared to Le954 million in 2005 representing an increase of 40%. The high incidence and severity of claims in respect of motor and miscellaneous accident accounted for the deterioration in the claims ratio from 28.30% in the preceding year to 32% during the current year.
The report also stated that management continued to pursue prudent underwriting and other risk management measures in order to arrest the deteriorating ratio.
The expense ratio for the year under review was 57% as compared to 66% for the corresponding period.
Underwriting profit for the current period was Le 323 million as compared to Le66 million for 2005.
Profit before tax was Le605 million as compared to Le651 million for the preceding year, which is a decrease of 7.6%. This was mainly due to a decrease in the rate of return on invested funds and an increase in claims paid.
The dividend paid to shareholders was Le1.10 per share after the directors have carefully considered the results of operations.
It was disclosed that this was payable on an increased number of shares resulting from the bonus issue of one share for every two shares held by members as at 31st December 2005 and represents an annual yield of 13.75%.
The chairman’s statement emphasized the continued professional training the staff continue to receive locally and overseas in order to render quality service to the customers and to meet the demands of the company’s expansion programme.
“In this regard, it is both with great pride and satisfaction that I report that, one of our staff Mr Raymond Macauley (BA MBA) was chosen to receive the International Award for Academic Excellence in the Chartered Property Casualty Underwriter (CPCU) programme. This award is presented annually to the non-US graduate with the highest cumulative grade averages on the examinations leading to the CPCU designation. The award includes a cash award and a commemorative plaque,” Dr Coker said.
He reiterated that the entire company was proud for Raymond’s outstanding achievement which attested to the quality of the company’s personnel and commitment to professional development.
Dr Coker said the company would continue to provide training and remuneration sufficient enough to attract, retain and motivate staff of the quality required to run the company successfully.
On future development, the chairman said the company held a positive view of the medium to long term prospects of the company.
The company can claim an impressive record; it has brought immense benefit to its shareholders, clients, employees and other stakeholders over the years.
The company is always looking ahead and pursues new opportunities for the benefit of our clients and other stakeholders.
“In this regard, we are pleased to announce the launching of our new product, Travel Insurance, which covers a traveler in respect of medical expenses, hospitalization and ancillary expenses abroad and satisfies the requirement for a Shenghen visa. The new product has been well received by both individuals and corporate clients”, the chairman said.
The report stated that the company would continue to provide excellent service to our clients with the aid of Information Technology; attract and retain the best staff and empower them to realize their full potential.
Also the company would continue to maintain its leadership role in the insurance industry through innovation, entrepreneurial and professional skills thus consistently earning profits and paying dividend in line with the shareholders expectations, the report stated.
The economy, the chairman said, affected the year under review as the IMF Poverty Reduction and Growth Facility (PRGF) continued to shape economic policy.
Real Gross Domestic Product (GDP) growth, according to the Bank of Sierra Leone, was estimated at 7.8%. This was mainly due to expansion in agriculture, mining, construction and service sectors.
Fiscal policy was directed at the attainment of macroeconomic stability as well as ensuring medium term debt sustainability whilst monetary policy focused on the attainment of low and stable inflation.
According to official sources year-on-year inflation fell from 13.8% in January 2006 to 8.26% in December 2006 largely owing to improved food supply and a relatively stable exchange rate.
Although the macroeconomic improvement is positive, there is the need for progress on structural reforms such as improved public expenditure management, strengthening domestic revenue and reforming the civil service.
The chairman stressed that the cost of doing business, weak infrastructure notably electricity, water supply, roads, ports and inadequate public services in general continued to pose an enormous challenge to their development efforts and put considerable pressure on profit margins.
He said in spite of the difficult operating environment, the company had continued to play a leadership role in fostering private enterprises.
The chairman thanked all their clients, the shareholders and management and staff for their tremendous contribution in making Aureol Insurance Company ‘takes the pain out of making a claim’.