Kenya Reinsurance Corporation Limited (Kenya Re) posted a 10% rise in gross written premiums from KShs18.535 billion in the year 2020 to KShs20.355 billion in 2021. The Financial Results were approved and released by the Board of Directors’ following a Special Full Board Meeting held on 30th March 2022.
Kenya Re Managing Director, Mr. Jadiah Mwarania, announced the Financial Results less than two weeks after the Corporation was recognized as one of the most inclusive companies listed at the Nairobi Securities Exchange (NSE) during the National Diversity and Inclusion Awards & Recognition (DIAR Awards) and Gala Dinner held on 18th March 2022. The announcement comes against a backdrop of a new Strategic Plan covering the period 2022 – 2026 that is expected to propel the Corporation to become more competitive, cost effective and responsive to environmental changes especially in this post-pandemic period.
Below are the highlights of the Corporation’s performance for the year ended 31st December 2021:
Investment income decreased by 4% from KShs3.792 billion in 2020 to KShs3.658 billion in 2021, due to the effects of Covid-19 pandemic in the investment environment.
Net earned premiums
Net earned premiums decreased by 8% from KShs20.850 billion in 2020 to KShs19.095 billion in 2021.
Cedant acquisition cost
Cedant acquisition costs decreased by 9% from KShs.5.310 billion in 2020 to KShs.4.809 billion in 2021.
Claims incurred in year 2021 decreased by 15% to KShs11.422 billion from KShs13.517 billion in 2020.
Operating expenses increased by 7% from KShs.1.965 billion as at 31st December 2020 to KShs.2.096 billion as at 31st December 2021, mainly driven by forex losses.
Profit Before Tax
Profit before tax for the year 2021 stood at KShs4.000 billion, an increase of 0.4% from profit before tax of KShs3.984 billion in 2020.
The asset base increased from KShs53.237 billion in 2020 to KShs55.824 billion in 2021, a growth of 5%.
Shareholders’ funds increased from KShs34.397 billion in 2020 to KShs37.040 billion in 2021, a growth of 8%.
Commenting on the impressive 2021 Full Year Financial Results, Kenya Re Managing Director, Mr. Jadiah Mwarania, lauded the Corporation’s profound resilience at a time when the economy was grappling with the ripple effects of the COVID-19 pandemic. ‘’We attribute the good results to enhancement of the existing underwriting framework, continued market expansions, building of operational capacity, leveraging on technology and stakeholders with the aim of continuously capitalizing on our strength as well as diversification of our portfolio of products and services.’’ He said.
He expressed confidence on reporting even better results in the coming financial years with implementation of the new strategic plan to guide all business operations and activities in the next five years (2022 – 2026). He remarked that the new strategic plan has identified and clearly outlined the key strategic issues, strategies and activities that the Corporation will address itself to in the next 5 years. He underscored the Corporation’s desire to continuously create more value to shareholders whilst providing sustainable risk and financial solutions. He reiterated the corporate focus on the key identified issues and strategies, going forward. These, he noted, will be anchored on the following identified objectives: to grow shareholders’ value, to improve customer centricity, to improve analytics capabilities, to leverage on technology to improve processes, to grow market share, to strengthen the human resource capacity, to strengthen governance practices, to enhance enterprise risk management and to strengthen internal control systems.
The Corporation surmounted a number of challenges to report these good results. Some of the challenges encountered are stiff competition in the reinsurance industry, domestication of regional markets such as Ethiopia, Ghana and Nigeria as well as regulations that make Kenya Re business operations very expensive such as CIMA (Francophone countries) region which requires huge capital investment, stringent Insurance Act like in Zambia amongst many others.
This being an electioneering year in Kenya, the Corporation has in place adequate capital to withstand economic shocks that may arise from any adverse political activities in the country. It has an operational Business Continuity Plan (BCP) that is currently activated to manage the pandemic and covers management of other risk events (including political) that may disrupt normal business operations. The plan is a blueprint on how we can continue serving our customers and meeting corporate objectives whilst managing any risk event that may materialize in the course of our operations.