Sovereign Trust Insurance Plc has once again gotten rated A- by the Global Credit Rating (GCR).
According to GCR, Sovereign Trust Insurance, has great potential for growth in the years ahead considering some of the strategies that had been put in place to propel its operations.
The agency also noted that the company has shown a great deal of consistency in claims paying obligations to its customers spread all over the country.
The agency further stated that the listing of the rights issue in 2019, helped in increasing the shareholders’ funds of the company by 33.8 per cent to N7.8 billion by the end of the financial year in 2019, as against the N5.8 billion recorded in 2018.
Consequently, by the third quarter of 2020, the shareholders’ funds had increased to N8.2 billion which also translated to a 31 per cent increase in the same corresponding period of 2019, with a figure of N6.3 billion.
In the rating agency’s opinion, Sovereign Trust Insurance is strong in liquidity with more than adequate claims coverage that compares well to industry average.
It further noted that the capital adequacy of the underwriting firm was considered strong and, “this is underpinned by the sizeable capital base catering for the quantum of insurance and market risks assumed.”
In this regard, the ratio of shareholders’ funds to NEP, (Net Earned Premium) improved to 189.2 per cent in the third quarter (Q3) of 2020 as against 130.9 per cent recorded in the corresponding quarter of 2019.
GCR, said in terms of peer-to-peer performance comparison, Sovereign Trust Insurance did very well when compared with other selected insurers in terms of capital, total assets, gross premium income (GPI) and net premium income.
Commenting on the development, the Deputy General Manager, Sales and Corporate Communications of the company, Mr Segun Bankole, said the company had creatively been able to develop a good mix of its clientele base with personal lines, contributing 42 per cent of its gross premium income during the rating period.
He added that the introduction of the Enhanced Third-Party Motor Insurance cover with the acronym ‘E3P’ in 2019 complemented the efforts of management at driving retail business initiatives in the industry. Other new retail products are already in the pipeline and will soon be introduced to the market in a not-too-long distant time.