Absa Life Assurance Kenya earnings up 90% to Sh862 million
Absa Life Assurance Kenya earnings up 90% to Sh862 million
Absa Life Assurance Kenya (Absa Life) has posted a 90 percent increase in earnings to Kes862 million for the financial year ending December 31, 2023, catalysed by investments in product diversification, digital capability expansion, and enhanced distribution channels.
Absa Life said a growing customer base and cost management initiatives saw key performance indicators rise by double digits, fuelling robust financial results despite a tough operating environment.
In the year, insurance services revenues surged by 29 percent to Kes5.9 billion, driven by new product lines such as the endowment plan launched in 2023, demonstrating Absa Life's commitment to providing relevant financial solutions that meet the needs of its clients.
Additionally, investment income went up by 27 percent to Kes1.1 billion, reflecting Absa Life's philosophy of investing funds in high-yield options that optimize investment returns.
Speaking about the financial performance, Absa Life’s Principal Officer, and Managing Director, Githanji Waiguru noted the value they continue to drive through their portfolio.
Empowering Africa's tomorrow together
“Absa Life continues to maintain a healthy quality of portfolio in the products we provide to the market and the policies that we underwrite, which is a clear testimony to the value we continue to drive both for our policyholders and the shareholders, and these results serve as a clear demonstration to this,” he said.
"As part of Absa Group, we are proud of the role we continue to play in ensuring the company's position as a wholesome financial services group offering banking, investment, and insurance services to support our customers’ growth stories. This aligns with Absa Group's corporate purpose of empowering Africa's tomorrow together, one story at a time,” added Absa Life Principal Officer and Managing Director Githanji Waiguru.
In the year under review, insurance contract liabilities increased by 21 percent year on year to Kes8.6 billion, owing to the acquisition of more policyholders. Total assets closed the year at Kes11.5 billion, up 26 percent from the previous year, thanks to increased investments.
Absa Life's return on equity (ROE) was 50.3 percent, up 18 percent year on year, with the company distributing Kes450 million total dividends to the shareholders.
“It is important to note that the current financial statements are based on IFRS17, the new global reporting standards for insurance companies that replaced IFRS4 on January 1, 2023. The resilience of our financial results is noteworthy, as evidenced by consistent growth in our key financial indicators,” Mr. Waiguru added.
Mr. Waiguru explained Absa Life had made significant investments in its technology infrastructure, which resulted in the automation of its systems and operational processes, translating to gains in operational effectiveness and efficiencies. This has supported the expansion of the business by providing a seamless customer experience, resulting in topline growth without compromising capacity.
Read also: Absa raises dividend payment 14.8% to Sh8.4Bn
Absa Life digital capabilities
Among others, Absa Life improved its digital capabilities through a revamped company website with enhanced customer interaction capabilities and continued to diversify its distribution approach to include collaborations with strategic partners such as insure-techs and other insurance service providers. The digital transformation agenda has helped to improve efficiency and customer interactions while also making Absa Life's products and services more accessible and affordable, Mr. Waiguru said.
"As part of our Environmental, Social, and Governance (ESG) agenda, we have continued to promote financial inclusion by providing financial products with societal impact, such as funeral policies and education plans that ensure the lives of one's dependents continue with minimal interruptions following incapacitation or accidental death,” Mr. Waiguru added.
Absa Life says it will continue engaging and listen to its customers, guided by the principles of empathy and seamless customer experience, while also investing in new distribution models to increase insurance penetration in Kenya.
The company remains well-capitalised, with strong headroom above the adequacy ratios, demonstrating its ability to accelerate its innovation agenda and fuel additional investments for future growth.
