By Nike Popoola

Tuesday, 21 Dec 2010

Niger Insurance Plc has assured shareholders of better returns on their investment in the years ahead.

In a statement from the company on Monday, the Managing Director, Mr. Clinton Uranta, said that having witnessed a challenging year in 2009, things could only get better in the coming years.

While speaking on the firm‘s 2009 financial result, he said, ”I think we have seen the worst this year, and by the grace of God, our figures will improve by the next accounting year.”

He explained that the regulatory authorities had introduced certain measures towards entrenching global best practice and good corporate governance in the nation‘s insurance industry. He noted that the high level provisioning, which the authorities were asking companies to provide for, was not making matters any better.

He said, ”Issues that hitherto were provided for in over a three-year period, are now under compulsion that companies provide for them just in one accounting year.”

In the company‘s result, he added that with the gross premium recorded in 2009, the company should be able to make good profit through which shareholders could get good dividend and bonuses, but, the provisioning and issues on revaluation, impacted negatively on the bottom line.

Uranta said he was not putting the blame on the supervisory authority, especially as the industry‘s regulator was doing its very best with the intention to stabilise the insurance industry and put insurers‘ balance sheet on better footing before things would get out of hand.

He pointed out that the insurance outfit had always taken good care of its shareholders over the years and that it had resolved to ensure that the shareholders always get good returns on their investment.

The Niger Insurance boss said, ”They have shown good understanding as well. Like I said earlier, when the going gets tough, it is only the tough that gets going and this is the time you will know who your real friends are.”

He said that when it was difficult to declare dividend, shareholders should be able to, at least, fall back on their bonus which was as good as cash.

He stressed, ”When bonus is awarded to you, you can trade on it, sell it off for cash and still retain your holding. You know, going by what companies are experiencing now, dividend is not the best to do at this time as falling back on bonus can help capital appreciation.”

The Niger Insurance boss also clarified that the insurance firm was always in good position to meet its obligation to policyholders in the area of claims payment notwithstanding the challenges in the operating environment.

He said, ”We have reinsurance and other securities spread all over the world, in America , London and they cover existing risks in line with terms of the agreement concerning treaties. In this case, they are compelled to assist whenever there is any claim beyond our retention capacity. That is a compulsion of the law as far as agreement on treaties is concerned.”

Source: Punch