Africa Re posts solid underwriting result with CoR of 88.74% in Q3’24

The African Reinsurance Corporation (Africa Re) reported a strong net underwriting result of $79.5 million at the end of the third quarter of 2024, marking an impressive year-over-year increase of 100.82% and resulting in an improved net combined ratio of 88.74%, down from 93.66% during the same period last year.

The company reported gross incurred claims of $436.8 million for Q3 2024, up from $404.4 million for the same period in 2023. This reflects a negative variance of 8.01%, attributed to an increase in claims reported and incurred across several of its business units and lines.

During the same period, the retrocessionaires’ share of incurred claims rose from $27.6 million to $45.5 million in Q3 2024. As a result, net incurred claims reached $391.3 million this quarter, compared to $376.8 million recorded in the same period of 2023.

Additionally, gross written premium (GWP) income totaled $879 million at the end of Q3 2024, representing an 8.99% increase from the $806.6 million reported in the same period last year.

According to the firm, this increase was due to successful marketing efforts, positive pricing momentum, and moderate economic growth in most African countries, its core markets, despite ongoing challenges posed by geopolitical tensions, extreme weather conditions, fiscal policy tightening, currency depreciation against the US dollar, and inflationary pressures.

Africa Re’s investment and other income for the quarter increased significantly by 59.40%, rising from $45 million in Q3 2023 to $71.7 million, driven by higher interest income from fixed-income instruments.

Due to strong underwriting and investment performances, the overall net profit reached $131.4 million, marking a 74.20% improvement compared to the same period last year.

Dr. Corneille Karekezi, The Group MD/CEO of Africa Re, commented, “Africa Re continues to demonstrate a strong and resilient business model which is able to capture the full benefits of a conducive environment characterised by a continuous positive adjustment or of global reinsurance market prices and the strengthening of returns in the global financial markets.”

Karekezi continued, “Barring any sharp decline of the investment returns, possibly following the outcome of the November 2024 US Elections or from heightening of current geopolitical tensions, or any adverse development of already reported natural catastrophe claims, or significant additional depreciation of major African currencies, the financial year 2024 is heading to a second successive historical record performance both in top line and in bottom line.”

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