Sri Lanka Insurance secures record

Sri Lanka Insurance Corporation Limited (SLI) disclosed its financial performance for the year 2010 through the official handover of its Annual Report and Audited Financial Statements for the year ended 31 December 2010 to President Mahinda Rajapaksa early this week.

Sri Lanka Insurance Chairman Gamini Senarath presents the 2010 Annual Report to President Mahinda Rajapaksa whilst Secretary to the Treasury P. B. Jayasundera and SLI Director Dhammika Perera look on from right. CEO and Managing Director Mohan De Alwis (standing next to the Chairman), SLI Directors Piyadasa Kudabalage, Noel Slevanayagam, R. A. Jayatissa and General Manager Administration SLI Neel Hapuhinna are also present

In a statement yesterday SLI said it recorded the highest-ever consolidated profits before tax amounting to Rs. 15.1 billion and profit after tax of Rs. 13.3 billion compared to Rs. 2.9 billion and Rs. 1.5 billion respectively in 2009.

Handing over the Annual report, SLI Chairman Gamini S. Senarath stated that this was a glowing example of an efficiently-managed State-owned organisation, dispelling the myth that the State cannot run profitable businesses.

In 2010, SLI reported a 24.6% growth in Life insurance premium increasing to Rs. 6 billion from Rs. 4.8 billion in 2009 whilst general insurance premium grew by 5.7% to Rs. 9.2 billion. The company achieved a combined Gross Written Premium (GWP) growth rate of 12.5% during the year. General insurance contributed 60.7% towards the total GWP whilst Life insurance contributed 39.3%.

SLI also declared a staggering Rs. 3.4 billion bonus to its Life policy holders for 2010, which is incidentally the highest-ever in the history of the company and the insurance industry in Sri Lanka surpassing the Rs. 3 billion declared in 2009. As the national insurer, providing life assurance protection to the masses, SLI covers a wide spectrum of people in all walks of life. To symbolise this occasion, seven selected Life policy holders from different professions and vocations received their bonus certificates from President Rajapaksa at the Temple Trees.

“In 2010 we remained the largest composite insurance provider in Sri Lanka. Our performance during the year has reaffirmed our status as not only the leader but also the most robust in the industry,” noted the SLI Chairman.

“Our progressive business approach has enabled us to proactively benefit from the opportunities that arose, and will continue to arise, in post conflict Sri Lanka. SLI contributed immensely to the consolidated fund in 2010 by declaring an interim dividend of Rs. 6.7 b. Additionally, we have also contributed Rs. 1.94 b by way of taxes,” Senarath added.

Speaking at the occasion, Managing Director and CEO Mohan De Alwis said that 2010 was a very eventful year for the company, achieving many milestones. SLI entered into many strategic business agreements with a long-term vision of developing business both with private sector companies and large State-owned financial institutions in its approach to improve growth and performance.

“Whilst concentrating on the development and growth of our core business, we have been looking for diversification as well as strategic long-term investments. With this in mind, we made a strategic investment in November 2010 purchasing 100% share holding of Shell Gas Terminal Lanka (Private) Limited and 51% of Shell Gas Lanka Limited, thus acquiring their controlling interest and now operate as Litro Gas Terminal (Lanka) Limited and Litro Gas Lanka Limited respectively engaged in importation, storage, filling and distribution of LPG in Sri Lanka,” De Alwis added.

“We acknowledge the dedication, commitment and understanding of our employees, field staff, strategic sales partners, various Government Institutions and brokers who worked diligently to deliver these outstanding results. We sincerely thank our clientele for their loyalty and trust placed with SLI and look forward to their continued association as the insurer of first choice,” he said.

Without disclosing specific numbers, SLI said it was extremely successful to follow the capital market developments in Sri Lanka and was able to exploit the opportunities that were available to it, thus boosting the income from investments to exceptionally high levels.

“SLIC has invested in admissible assets and maintained its solvency requirements,” SLIC Executive Director Piyadasa Kudabalage said.

SLI’s Life fund increased from Rs. 44 billion in 2009 to Rs. 52.6 billion in 2010, which is a 20% growth, due to prudent investment policies adopted by the company providing further strength and stability to the life policy holders.

SLI has also improved its risk based capital position over the years and has been upgraded by Fitch Ratings Lanka on National Long-Term rating and National Insurer Financial Strength to ‘AA(lka) from AA- (lka) stable recently, Kudabalage added.

Sri Lanka Insurance Corporation Limited was established in 1962 as a State-owned corporation. In 1993, it was converted to a fully Government-owned limited liability company and subsequently, under the privatisation programme of the Government, the company was privatised in 2003 and was under the private management for a period of six years. The company was reinstated as a nationalised entity on 4 June 2009.

Its association with the State has further strengthened the company and is considered the largest insurer in Sri Lanka. SLI has firmly established itself as one of the most respected players in the insurance industry.

With over 120 branches islandwide, an unparalleled asset base of over Rs. 88.9 billion with a Life fund of over Rs. 52.6 billion and over 600,000 policies in force, SLI continues to demonstrate its stability, strength and long-term sustainability by being recognised as the only insurer in Sri Lanka to be ranked AAA by RAM Ratings and AA (lka) Stable outlook recently by the global rating agency Fitch Ratings (London).

SLI is fully compliant to ISO 9001:2008 certification. At the World Finance Awards 2010 held in London SLI was adjudged the ‘Best Insurance Company of the Year 2010 – Sri Lanka’.