Ethiopian Insurance Company covers 4.4 trillion birr worth rate of properties 

 

 

The total insurance coverage of the Ethiopian insurance corporation, which holds the largest market share of the Ethiopian insurance industry, has reached more than 4.4 trillion birr.

The property and services covered by the insurance company’s services across the country are estimated at 4.4 trillion birr, which is an increase of 11.7 percent from the previous year, according to the recently announced 2015 financial year performance report.

Ethiopian Airlines, Ethiopian Railway Corporation infrastructure, the Great Ethiopian Renaissance Dam, and other mega public and private projects were provided insurance coverage by the Ethiopian Insurance Company. The report indicates that the Ethiopian Insurance Company was able to sell and renew a total of 161,315 contracts in the 2015 financial year.

 

Ethiopian Insurance Corporation report in comparison to the previous year

This year’s  performance of Ethiopian Insurance corporation is 31 % lower than the same period of the previous year, it is known that the amount of property and insurance coverage provided has increased.

This report indicates that the Ethiopian Insurance corporation managed to collect 6.9 billion birr in premium income at the end of the completed financial year, which shows that the performance achieved 94.1 percent of the plan.

In his report, the CEO of Ethiopian Insurance corporation, Ato Zildabe Lemesa, mentioned that the amount of premium recorded in the financial year showed an increase of 5.4 percent or 354.8 million birr compared to the previous financial year.

6.7 billion birr or 96.4 percent of the total premiums recorded by the company in the financial year came from the general insurance sector, while the remaining 247.2 million birr, or 3.6 percent was collected from the long-term insurance or life insurance sector.

The company’s annual report indicates that the company’s market share of the total premium of the industry is 30.4 percent.

The CEO pointed out that the performance is good when the premium income is evaluated from the perspective of the plan as well as the previous financial year.

Despite this, Ato Netasnet did not fail to mention that various problems and challenges have affected the company’s premium income.

Among the challenges that made it impossible to increase the premium income to the desired level, mainly mentioned the significant reduction in aviation insurance coverage.

According to Mr. Netsant, Aviation’s insurance coverage decreased by 716.9 million birr from the previous fiscal year, and 714.7 million birr from the plan, which hurt the premium growth.

The main reason why the company’s premium income has decreased in the aviation sector is that the aviation industry has been affected by the global COVID-19 pandemic and other related factors.

According to the CEO’s explanation, the reduction in the premium rate of aviation insurance has caused damage to the company’s performance.

If this challenge did not exist, the company’s premium income and market share would have been much higher than this, the CEO said.

In the 2015 financial year, especially in the aviation insurance coverage, in the explanation given to the reporter regarding the reduction in aviation insurance coverage, he said that the aviation industry had been severely damaged in the previous two years due to the Covid-19 epidemic and as a result, the activity of the sector has been limited, so the insurance companies have reduced the premiums in consideration of this.

Ethiopian Insurance corporation, explained that due to the significant reduction in premiums for the aviation industry,starting from 2014 the premium income he used to get from the sector has come down.

The Ethiopian Insurance corporation also hoped that the premiums it was getting from Ethiopian Airlines would be better due to the increase in the airline’s activity. Regarding next year’s plan of the Ethiopian Insurance Company, Mr. Lisbeth told the reporter, that in terms of premium income collection, it is planned to earn nine billion birr in premium income in the 2016 financial year.

He also stated that this plan was prepared with the assumption that the conflicts in the country would return to peace.

“We think that we can act like a heart everywhere,” said Mr.Nestant, adding that he believes that his plan will succeed as many other reform works will be carried out.