Jubilee Holdings has failed to grow its profit for the first time in 12 years, slowed by a decline in earned premiums as expenses shot up in the financial year ended December 2018.
Net profits fell marginally by 1.3 percent to Sh4.18 billion in a period described by the company as having been “exceptionally challenging”.
Jubilee chairman Nizar Juma said that while 2018 was a challenging year for the insurance industry across the region, but particularly in Kenya, the insurer maintained strong performance.
“Our 80 years of experience, lowest expense ratio in the industry and conservative approach to investments has allowed us to post the impressive results that we have released today” said Mr Juma.
“Jubilee’s growth in Uganda and Tanzania has strengthened our market leadership.”
The board has declared a final dividend of Sh8 per share for a combined interim and final dividend of Sh9 per share.
Total income dropped by 10.4 percent to Sh28 billion driven by 9.8 percent decline in gross earned premiums to Sh26.7 billion.
However, operating profits rose by 4.8 percent to Sh5.41 billion, supported by a strong contribution from insurance results at Sh2.9 billion against Sh2.7 billion the previous year.
A higher tax expense of Sh1.33 billion, being 33 percent higher than that paid in 2017, dragged the net earnings. Other listed insurers that had reduced earnings include Britam, Liberty, Sanlam and Kenya Re.
With underwriting profit of Sh753 million, Jubilee Kenya outperformed the industry.
Mr Juma attributed this on biometric identification that has helped reduce fraud.
“It makes it more difficult for fraudsters to falsify claims,” said CEO Julius Kipng’etich.