Lasaco Assurance fell into lossmaking position in 2025 as the significant foreign exchange gains that boosted profit the year before faded out, and insurance service result turned negative for the second year running.
The life and general insurance provider recorded no FX gains for the year as the dollar-to-naira exchange rate witnessed substantial stability, unlike in 2024, when a much weaker naira enabled the company to earn as much as N3.2 billion in currency gains.
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That change in circumstance set the underwriter on the path of a N3.1 billion post-tax loss, compared to an after-tax profit of N1.5 billion a year earlier.
Its unaudited earnings report released on Tuesday showed insurance revenue was up by 31.4 per cent at N30 billion.
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However, insurance service revenue, a key metric for measuring performance in the insurance business, stood at a negative position of -N2.1 billion, up from -N1.2 billion.
On the contrary, peers like Cornerstone, AIICO and Mutual Benefits have been recording positive growth in their insurance service result, a marker of their capacity for cost efficiency in their core business.
Insurance service expenses as a percentage of revenue for the company stood at 84.2 per cent in the year under review, compared to just 47.1 per cent for Cornerstone, 68.7 per cent for AIICO and 76.4 per cent for Mutual Benefits. It reflects those companies’ ability to keep underwriting cost low.
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The company’s investment result rose by 18 per cent to N6.2 billion, boosted by an improvement in interest revenue. Net investment result declined by 28.9 per cent to N8.5 billion.
Insurers in Nigeria are racing against time to increase their capital ten times to new regulatory thresholds, following the introduction of the Nigerian Insurance Industry Reform Act 2025 last year, as the industry aspires to build underwriters’ capacity to take on more risk.
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Lasaco Assurance, which operates under a composite insurance licence, needs to scale up its capital to N25 billion. Like other insurance companies, it has to meet those requirements by August.
The board, last December, approved the move to source more equity capital through a mix of private placement and rights issue. The company expects to have increased its minimum share capital to N36.1 billion from N11.1 billion at the end of its capital raise programme.
Loss before tax for the review period stood at N3 billion, compared to a profit before tax of N1.6 billion a year ago.
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