CEO’s Discussion & Analysis



Assalamualikum

Honorable Shareholders,

I would like to extend greetings from the Agrani Insurance Company Ltd. I welcome you to the 20th Annual General Meeting with a brief discussion and analysis on the financial statements of the company for the year 2019. We completed year 2019 with mixed insurance business environment with major reform in maintaining the defined bank accounts to operate non-life insurance business. Bangladesh Insurance Association (BIA) being an influential organization in the insurance market has also come out with positive direction with “Gentleman Agreement” to refrain from underwriting of renewal insurance business of other non-life insurers. The government has also given importance to insurance sector to make it a significant industry to increase contribution to the country’s gross domestic products. It makes us proud that the father of the nation was associated with insurance sector.

Comparing global market 

If we look towards the forecasts of Swiss Re Global non-life premiums are forecasted to grow by at least 3 percent annually in real terms in 2019-2020 and emerging markets, particularly in Asia, will remain the driver of global non-life premium growth. It also suggests that the advanced market premiums will grow by 1.5%, and emerging markets by 7.9%.

In 2019 AICL achieved a growth of 10.49% in gross premium and -3.36% in net premium income because of proper reinsurance coverage taken to safeguard the interest of the insured.

2019 key financial indicators 

We maintained a healthy growth of gross premium and underwriting profit with an increase of 19.89%. Our most premium generating business classes are Fire, Marine, Motor and Miscellaneous. AICL has been trying to enhance the business underwriting in all the classes.

Particulars
BDT-2019
BDT-2018
Growth
Gross Premium
423,198,765
383,009,038
10.49%
Net Premium
192,276,426
198,952,487
-3.36%
Underwriting profit
60,781,331
50,698,031
19.89%
Interest income
17,270,671
14,337,467
20.46%
Profit before tax
47,969,667
55,185,802
-13.08%


If we analyze divisional segment of our business performance we find that Dhaka division and Chottogram division cover major concentration of AICL gross premium income. The divisional segment of AICL gross premium concentration in 2019 is as follows:


Division
Business Concentration
Dhaka
67.10%
Chottogram
20.47%
Khulna
1.86%
Mymensingh
4.25%
Rajshahi
1.29%
Rangpur
2.94%
Sylhet
0.71%
Barisal
1.36%
Total
100.00%
Conceiving of new vision for best practices:
AICL has conceived new vision to restructure the philosophy of business ethics and gradually it would prove itself to establish its position in the non-life sector with best ethical practices complying with the regulatory requirements and follow the applicable rules and regulations in every respect. 

Developing human capital
AICL has recruited some experience persons in the year under review with a view to develop the human capital arranging adequate in house training on the job to the existing staff and also arranging training by external resources. This would be on going till the ensuring of quality services to the insured and stakeholders. The members of the staff of the company are the significant resources who run the company keeping it on the right track.

Contribution to national exchequer
AICL with its committed staff members for ensuring transparency in all corners have already been very careful about payment of appropriate government duties including VAT, taxes and insurance stamps. In 2019 it has paid Tk. 65.77 million against Tk. 57.93 million in 2018.
Finally, I would like to deliver my sincere thanks to the Hon’ble Chairman and the members on the Board of AICL for their sensible vision, valuable participation and patronage and the prudent management team with sound & expert knowledge in operating insurance business for the commitment in accelerating and implementing our business strategy, over and above, in the mission of rebuilding AICL in the positive direction.

We believe in our accumulate efforts of all will certainly bring a better future for all associated with the Agrani family.

Thanking you all
Md. Azharul Islam
Chief Executive Officer
Agrani Insurance Company Ltd.
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