Assa profits drop 19% on costs, claims

Panama's largest insurance group Grupo Assa reported net income of US$1.4mn for the third quarter of 2004, down 19% from the same quarter a year ago, according to financial statements posted on the company's website. Profits were hurt by modest premium growth coupled with across the board increases in costs and claims. Net premiums increased 7% to US$15.4mn, while retained premiums rose 6% to US$10.5mn. Policy acquisition costs increased 10% to US$1.6mn. Claims were up 3% at US$4.9mn. Personnel and other operating costs rose 7% to US$3.2mn, while net financial income was up little changed at about US$2mn. The company's operating income was virtually flat at US$1.4mn. Assets stood at US$307mn as of September 30, 2004, an 11% increase compared to year-end 2003. The financial investment component increased 15% to US$194mn. Reserves grew 6% to US$54mn, while equity rose 9% to US$188mn. Assa was founded in 1981 and offers personal (life, health, accident), general (auto, fire, and related lines), and surety products. At the end of September there were 18 insurance companies operating in Panama, of which the top five had the following market shares in terms of premiums: Assa (17%); Aseguradora Mundial (17%); Compañía Internacional de Seguros (16%); Compañía Nacional de Seguros (15%); and Assicurazioni Generali (7%).