Sanlam Kenya’s net loss for the fiscal year that ended in December has been reduced by 90% as a result of improved short-term business performance, which includes motor and medical coverage.
The insurer’s net loss dropped from Sh542.36 million to Sh54.07 million this year as a result of fewer general business expenses, often known as short-term insurance.
The net loss of the general insurance division, which fell from Sh500.9 million to Sh151.66 million, contributed to a reduction in the group’s losses. In spite of this, the life insurance industry’s net profit fell from Sh641.99 million to Sh608.6 million.
With the most recent performance, Sanlam Kenya has now lost money three years in a row. 2019 saw the company’s last net profit as it ended the year with Sh114.4 million.
Due to the loss, investors will have to wait without dividends for a ninth consecutive year. The most recent dividend paid by Sanlam Kenya was Sh432 million at Sh4.50 per share in 2013, when net income reached Sh1.25 billion.
Shareholders of the Nairobi Securities Exchange-listed company Sanlam have similarly seen their wealth decline from Sh8.64 billion in 2013 to the current price of Sh1.18 billion.
The group’s total losses have now surpassed Sh1.15 billion, up from Sh998 million the previous year. Sanlam General’s total revenue fell from Sh3.48 billion to Sh3.17 billion in the fiscal year ended December 31, as gross written premiums fell by almost one-third to Sh3.3 billion.
The general company, on the other hand, was able to cut losses due to a 22% fall in overall expenses, or Sh902 million, to Sh3.24 billion. The cost reduction was made feasible by a 52 percent drop in operational expenses, from Sh1.03 billion to Sh488 million.
Sanlam Life reported a fall in net earned premium from Sh7.37 billion to Sh6.35 billion, which contributed to a 12.5 percent decrease in total income to Sh7.78 billion.
Sanlam Life was able to mitigate the decline in net profit thanks to a drop in net benefits and claims paid from Sh6.1 billion to Sh5.12 billion and a drop in total expenses of 13.5 percent to Sh6.88 billion.
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