Non Life Insurance: Increment of Paid up by 22%, Reserve by 32%, Insurance fund by 53%,Long Term Investment by 34%, & Net profit by 8%
This study analyzes 12 listed non life insurance companies namely Himalayan General Insurance Company Limited (HGI), United Insurance Compamy (Nepal) Limited (UIC), Premier Insurance Company (Nepal) Limited (PIC), Neco Insurance Limited (NIL), Sagarmatha Insurance Company Limited (SIC), Prabhu Insurance Company Limited (PRIN), Prudential Insurance Company Limited (PICL), Shikhar Insurance Company Limited (SICL), Lumbini General Insurance Company Limited (LGIL), NLG Insurance Company Limited (NLG), Siddartha Insurance Limited (SIL), and Rastriya Beema Company Limited (RBCL).
This study compares the indicators of non life insurance companies from Q1 of current fiscal year to the Q1 of the last fiscal year. Let’s put some of the fundamentals of these non Life insurance under microscope:
- Paid Up Capital
The average paid up capital of non life insurance in our study has increased by 22%. SICL has the highest paid up capital. The UIC has highest percentage change in paid up capital of 150%. The RBCL has lowest Paid up capital because the company has not given any stock dividend or or right shares for the past few year.
2. Reserve
On an average reserve of non life insurance company has increased by 32%. RBCL has above 50% of the total reserve of 12 Non life insurance companies study in this report. The PIC has highest percentage change in reserve by 141%. The NIL has also increased its reserve by 101%. The reserve of SIC has decreased by 5%.
3. Insurance Fund
The average insurance fund of non life insurance has increased by 53%. There is no change in Insurance fund of SIC due to too many claims filed after the earthquake. RBCL has managed the highest insurance fund and also has increased its insurance fund by 87 %.
4. Long Term Investment
The RBCL has decreased its Long term investment by 37%. The HGI has massively increased its long term investment. The average long term investment has increased by 34%. Over all the non life insurance long term investment shows an increasing trend. PIC, SIL, PRIN, HGI and UIC have increased its long term investment by more than 100%.
5. Net profit & Loss
The Average net profit of non life insurance has increased by 8%. The net profit of SIC has decreased by 67% as SIC has the biggest number of claims filed after of earthquake. The LGIL has managed to increase its net profit by 121% while the net profit of RBCL has decreased by 36%. The average net profit of non life insurance has decreased which is a result of higher than usual claims being filed after earthquake.
6. Number of Policies
The average no of policies holder has increased smoothly. The SICL has highest number of policies holder. Number of policy holder have decreased for SIC and SIL. As many people of expected to insure their properties after the earthquake, the number of policies will rise in coming days.
7. Net Worth Per Share
RBCL is has the highest net worth per share of Rs 2218.19 which represents increment of 43% as compared to the last corresponding quarter. The average net worth per share of non life insurance company has increased by 20%. Net Worth of UIC and SIC has decreased by 32% and 9% respectively.
8. Earnigs Per Share (EPS) Annualized
The average Earning Per Share (EPS) of non life insurance is RS 28.36 which is decrease of 12% as compared to the last corresponding quarter. LGIL has increased EPS by more than 100%. The SIC has decreased its earnings per share by 71%. PRIN, PIC, HGI, NIL, SIC, UIC have EPS in negative which means the companies are at loss as per the Q1 report of the current fiscal year.
The non life insurance sector of Nepal has promising outlook as major indicators re positive. The increment in Paid up capital, Reserve, Insurance Fund, and Long Term Investment indicates strong fundamentals of the company. The industry wide 8% rise in net profit should not be alarming as the profit took a toll due to the higher number of claims filed after the massive earthquake of April 25, 2015. In the absence of any major disasters the non life insurance sector is expected to make a smooth growth.
