Prestige Assurance Plc, a non-life insurer with over 70 years of experience in Nigeria, has posted its weakest first-half after-tax profit in six years.

The company’s after-tax profit for H1 2025 came in at N519 million, an 81 per cent fall compared to N2.78 billion in the prior period. Despite a solid 32 per cent rise in gross written premium to N15.32 billion and a 39 per cent increase in insurance revenue to N12.3 billion, driven by improved marketing and prompt claims settlement, the company’s profit plummeted.

The surge in insurance service expenses, which jumped 86% to N10.9 billion, led to a sharp contraction in insurance service results to just N18.3 million, a 97% drop from last year. Although reinsurance recoveries provided some relief, cutting net expenses by 41%, they were not enough to offset the higher claims and acquisition costs.

Prestige’s investment income also took a hit, with a 47% slump to N1.63 billion, mainly due to lower foreign exchange gains and muted fair-value gains on financial assets. Operating expenses further squeezed margins, with management expenses rising 53% to N947.96 million, reflecting higher staff costs, professional fees, and office expenses.

As a result, profit before tax dropped 82% to N577.3 million, while earnings per share fell to 4 kobo, down from 21 kobo a year ago. The company’s total assets grew 12% year-on-year to N42.7 billion, supported by higher reinsurance assets and debt instruments, while shareholders’ funds rose 3% to N19.9 billion.

In a related development, a new insurance reform bill signed into law by President Bola Tinubu proposes that the minimum capital required for life, non-life, and reinsurance businesses be raised to N10 billion, N15 billion, and N35 billion, respectively.

Despite the significant drop in profit after tax, Prestige Assurance ended the second quarter of 2025 with a strong liquidity position. Net cash generated from operations and investment activities drove a N2.4 billion boost in cash and cash equivalents. Operating activities produced N809 million net cash inflow, while investing activities were the major source of cash, posting a N1.59 billion net inflow.