The National Reinsurance Corporation of the Philippines (Nat Re) posted a drop in net income last year as stronger underwriting results were weighed down by lower investment income. 

In a statement on Wednesday, May 5, Allan R. Santos, Nat Re president and chief executive officer said the country’s national reinsurer’s net income declined by 24 percent in January to December last year to P120 million from P157 million a year earlier.

Nat Re also generated other comprehensive income of P267 million to bring its total comprehensive income to P387 million in 2020.

 “While Nat Re’s financial performance in 2020 reflected financial market volatility caused by COVID-19 especially in the first half of the year, the company ensured operational resilience to continue delivering reinsurance-related services and serve its customers efficiently,” Santos said.

Nat Re’s gross written premiums increased by three percent to P4.47 billion from P4.34 billion in 2019 due to growth in reinsurance premiums from the life and non-life domestic business.

Net underwriting income before administration expenses rose significantly by 151 percent to P341.7 million from P136.4 million in 2019, resulting from higher reinsurance premium income and lower loss ratios.

Nat Re’s combined ratio—the sum of loss, commission, and expense ratios and a measure of the profitability of the company’s insurance operations improved to 98 percent from 104 percent in the previous year.
A combined ratio below 100 percent indicates the company is making an underwriting profit, while a combined ratio above 100 percent means the company is paying more claims and expenses versus premiums.