Cornerstone Insurance grows gross premium to N4 billion

Friday Ekeoba, Lagos

Fola Daniel,
Commissioner for InsuranceCORNERSTONE Insurance Plc expanded its market share significantly in 2008, growing gross premium by 37 per cent to about N4 billion.

Audited report and accounts of Cornerstone Insurance for the year ended December 31, 2008, showed that the insurance company’s gross premium, which measures the volume of businesses by a risk firm within a period, rose from N2.78 billion in 2007 to N3.81 billion in 2008.

The directors of the company, however, decided to reposition the company for sustainable growth, and thus made full provisions for the outstanding premiums or bad debts over the years, as well as the depreciation which has characterised investments on the stock exchange.

The decision had negative impact on the bottom-line, leaving the company with a net loss of N419.5 million in 2008. However, first quarter report showed that Cornerstone Insurance was off the red with group pre and post-tax profits at N356.64 million and N161.1 million in first quarter 2009. Group gross premium stood at N1.3 billion in the first three months of this year.

Mr Dominic Ichaba, Acting Managing Director, Cornerstone Insurance Plc, said the write-downs and provisions were parts of a comprehensive ethical revolution aimed at repositioning Cornerstone Insurance as Nigeria’s leading insurance-based financial services group.

He said with the adoption of international best practices in accounting reporting standards, guidelines and provisions as well as full compliance with the provisions of Nigerian regulators, Cornerstone Insurance was leading a new ethical rebirth of the Nigerian insurance industry, as it championed the rebirth of the industry in the early 1990s.

Cornerstone Insurance made some N1.3 billion as provisions for diminutions in investments and other assets in 2008.

Ichaba said although the decision to adopt internationally acceptable best practices in business dealings, including prompt payment of claims, and accountings might result in a momentary slowdown in the company’s two-decade high profile performance, it would translate into sustained growth and better returns in the long run.

According to him, the company has retooled and restructured its businesses and management with a view to ensuring attractive values.

He outlined major restructuring initiatives in recent time to include upgrade of business processes through enhanced cutting-edge information and communication system and engagement of top quality business leaders to drive its respective business divisions as a composite player.

He said the company has emplaced necessary structure to drive its consumer and retail insurance, adding that Cornerstone intended to deepen insurance penetration in the country from the present one per cent in the short and long-term by writing over one million policies and ensure each customer has over three insurance solutions in the nearest future.

He pointed out that Cornerstone recently opened offices in Uyo, Abeokuta, Jos, Makurdi, Osogbo and Yenegoa in an across-the-country drive to bring insurance nearer to Nigerians.
He noted that with increased financial and human and managerial capital, Cornerstone was poised to be the leader in insurance services and returns to shareholders.

He pointed out that in the nearly two decades of the company’s existence and since going public in 1997, it has never recorded loss in its financials and has consistently declared bonus and dividend payouts to shareholders.

He urged shareholders and other stakeholders to support the business regeneration efforts of the company, assuring that these painstaking decisions would result in greater benefits to shareholders and all other stakeholders in the years ahead.