Global economy

The global economy grew by 3% in 2018 as against 3.7% in 2017. Global financing conditions have tightened, industrial production has moderated, trade tensions remain elevated, and some large emerging market and developing economies have experienced significant financial market stress. Faced with these headwinds, the recovery in emerging markets and developing economies has lost momentum. Downside risks have become more acute and include the possibility of disorderly financial market movements and an escalation of trade disputes. Debt vulnerabilities in emerging market and developing economies, particularly low-income countries, have increased. More frequent severe weather events would raise the possibility of large swings in international food prices, which could deepen poverty.

In a nutshell, growth has weakened, trade tensions remain high, and several developing economies have experienced financial stress. In this difficult environment, it is of paramount importance for emerging markets and developing economies to rebuild policy buffers while laying a stronger foundation for future growth by boosting human capital, promoting trade integration, and addressing the challenges associated with informality. The global economy is projected to moderate downwardly from 3% in 2018 to 2.9% in 2019. Projected moderation of investment growth in major advanced economies is expected to lead to slower trade growth, the potential for much faster growth is limited and a slowdown is setting in. While some major emerging markets are maturing themselves, they are unlikely to return to growth trends of the past. The good news is that qualitative growth factors – an improvement in labor force skills, digitization, and especially stronger productivity growth – may help provide better conditions for businesses to thrive over the next decade. Growth in emerging markets and developing economies as a whole is projected to strengthen to 4.2% in 2019 as activity in commodity export continues to recover amid firming prices.

African economy

The recovery in Sub-Saharan Africa continues at a softer pace. Gross Domestic Product (GDP) grew by 2.7% in 2018 as against 2.4% in 2017, significantly slower than expected, partly due to weaknesses in the region’s three largest economies:Angola,Nigeria, and South-Africa. The World Bank hinted that the growth will remain well below its long-term average in many countries as growth among main trading partners moderates, global financial conditions tighten, and trade policy uncertainty persist.

Year 2019 is expected to be another year of modest growth for sub-Saharan Africa’s economies. The World Bank forecasts a growth of 3.4% for the year. This is predicated on diminished policy uncertainty and improved investment targeted at diversification in large economies, together with continued robust growth in non-resource intensive countries. However, slower-than projected growth in China and the Euro Area, which have strong trade and investment links with Sub-Saharan Africa, would adversely affect the region through lower export demand and investment. Furthermore, the IMF opined that a faster-than-expected normalization of advanced-economy monetary policy could result in sharp reductions in capital inflows, higher financing costs, and disorderly exchange rate depreciations in Sub-Sahara African countries with weaker fundamentals or higher political risks. Sharp currency declines would make the servicing of foreign currency-denominated debt, already a rising concern in the region, more challenging.


For the past several years, the global reinsurance sector has weathered unfavorable and continuously changing business conditions. The challenges have included a prolonged soft reinsurance pricing cycle, heightened competition, limited organic growth opportunities, a record influx of alternative capital, low interest rates, mergers and acquisitions, and large catastrophe losses. Against this backdrop, reinsurers are trying to pull whatever levers they cannot, only to remain relevant but also to sustain profitability. After years of declining property/ casualty rates, renewals in 2018 brought modest increases and a temporary breather for the sector. This moderate reinsurance rate increases however, does not really transform into reinsurers’ profitability as the sector continues to face other weak business conditions.

The returns barely exceed its cost of capital in 2018. While the global property/casualty reinsurance sector suffered heavy losses in recent years, the global life reinsurance sector remained solid, with stable returns and growth rates. High barriers to entry, advanced risk management and underwriting capabilities are ensuring sound business conditions for the global life reinsurance industry that culminate to strong fundamentals that will help to fuel future growth. The operating environment in Sub-Sahara Africa remains challenging, with significant headwinds of currency volatility and inflationary strains. The continent’s reinsurers have been affected by slower growth, reflecting challenging economic conditions and subsequently suppressed demand for commodity goods. Despite this backdrop, the reinsurance market in Sub-Sahara Africa continues to offer growth potential. It is projected that more global reinsurance companies will be coming into the African market to drive the growth and enhance competition.

Nigerian insurance market

The group’s Gross Premium Income (GPI) grew by 15%, from NGN29.67 billion in 2017 to NGN34.19 billion in 2018. The Company, which covers business from Lagos, Abidjan and Tunis contributed NGN19.19 billion of the group’s premium, representing 56%, while the subsidiaries contributed NGN15 billion representing 43%. The Company’s Gross Written Premium (GWP) grew by 6%, from NGN18.2 billion in 2017 to NGN19.2 billion in 2018. GWP contributed by the subsidiaries grew by 32%, from NGN11.4 billion in 2017 to NGN15 billion in 2018. The group generated business from the six regions of Africa. 43% of the business came from Anglophone Western Africa, 22% from Eastern Africa, 14% from Southern Africa while the remaining 22% is shared between the other 3 regions of Africa.

The breakdown of GWP shows that Non-life grew by 16%, from NGN26 billion in 2017 to NGN30 billion in 2018; while Life GWP grew by 13%, from NGN3.7 billion in 2017 to NGN4.2 billion in 2018. Group underwriting profit declined by 9%, from NGN1.30 billion in 2017 to NGN1.18 billion in 2018. Despite the recorded reduction in underwriting performance compared to year 2017, Profit Before Tax (PBT) increased by 22% from NGN3.57 billion in 2017 to NGN4.36 billion in 2018 and an increase in Profit After Tax (PAT) by 34% from NGN2.47 billionin 2017 to NGN3.32 billion in 2018. Investment Income rose by 11%, from NGN1.97 billion in 2017 to NGN2.20 billion in 2018. Currency Exchange gain increased by 66% from NGN 1.1 billion in 2017 to NGN1.9 billion in 2018. Total assets increased by 34%, from NGN43.13 billion in 2017 to NGN57.64 billion in 2018. Shareholders’ fund also grew by 39%, from NGN20.78 billion in 2017 to NGN28.95 billion in 2018.

Financial result

The group’s Gross Premium Income (GPI) grew by 32%, from NGN22.4 billion in 2016 to NGN29.6 billion in 2017. The Company, which covers business from Lagos, Douala, Abidjan and Tunis contributed NGN20.3 billion of the group’s premium, representing 68%, while the subsidiaries contributed NGN9.2 billion representing 32%. The Company’s Gross Written Premium (GWP) grew by 17%, from NGN17.3 billion in 2016 to NGN20.3 billion in 2017. GWP contributed by the subsidiaries grew by 82%, from NGN5.1 billion in 2016 to NGN9.3 billion in 2017.

The group generated business from the six regions of Africa. 47% of the business came from Anglophone West Africa, 21% from East Africa, 11% from Southern Africa while the remaining 21% is shared between the other 3 regions of Africa. The breakdown of GWP shows that Non-life grew by 31%, from NGN19.8 billion in 2016 to NGN26 billion in 2017; while Life GWP grew by 40%, from NGN2.7 billion in 2016 to NGN3.7 billion in 2017.

Group underwriting profit increased by 213%, from NGN414 million in 2016 to NGN1.30 billion in 2017. Investment income rose by 31%, from NGN1.5 billion in 2016 to NGN1.97 billion in 2017. Currency Exchange gain dropped from NGN 4.1 billion in 2016 to NGN1.1 billion in 2017, mainly due to relative stability of the Naira which is the group’s reporting currency. Profit Before Tax (PBT) reduced by 23% from NGN4.65 billion in 2016 to NGN3.57 billion in 2017, mainly due to stability in the Naira as against the sharp devaluation that occurred in the year 2016; while Profit After Tax (PAT) dropped by 21%, from NGN3.12 billion in 2016 to NGN2.47 billion in 2017. Total assets increased by 7%, from NGN40.3 billion in 2016 to NGN43.1 billion in 2017. Shareholders’ fund also grew by 6%, from NGN19.7 billion in 2016 to NGN20.8 billion in 2017.

Head office building

The construction of our state-of-the-art head office building commenced in 2018 in Lagos and is nearing completion. The new building which is designed with the intention of continuing to promote environmental sustainability will provide our staff with a functional, spacious and stylish space to work in and run our operations; in turn, increasing productivity and enhancing our strong brand image.. As envisaged, the project is expected to be completed before the end of the year 2019 while commissioning will follow immediately.


The Board of Directors do not recommend the payment of dividend for the year 2019 ended December 31, 2018.


Our employees are our greatest assets to stimulate achievement of the business objectives and goals for the Company. This forms the basis of the Company’s employment policies. Our policies comply with all regulatory demands in recruitment and treatment of employees. The company ensure that the right talents are considered for appointment, diversity and inclusion in its people management agenda and also promotes equal opportunity for all employees to acquire the right competencies that will enable them to deliver the best results and greater employee satisfaction. Our employees are dedicated and always strive to make significant contribution toward stabilizing our growth and business. Their responses to the challenging and dynamic business environment are making ”Continental Re” the preferred company in the market.

Future outlook

Distinguished shareholders, we remain strongly committed to ensuring that our Company continues to improve on all its performance- measurement parameters. Our vision for “Continental Re” to be the premier Pan-African reinsurer is undaunted and we continue to pursue this with strength and vigor. Our objective is an Africa that grows from within and our strategy is focused on taking advantage of the immense opportunities that abound across Africa for the benefit of all stakeholders.


Despite the many challenges presented by the business environment in 2018, your Company was able to turn in a good result. This achievement would not have been possible without the support, understanding and cooperation of all our partners. I thank the directors for their continued commitment to ensuring that the Company is well run for the benefit of all of us. I also thank the management and staff for their dedication.