NEM INSURANCE : QUARTER 5 FINANCIAL STATEMENT FOR 2023

NEM INSURANCE PLC

ANNUAL REPORT

31 DECEMBER 2023

NEM INSURANCE PLC

ANNUAL REPORT, 31 DECEMBER 2023

Contents	Pages
Corporate Information		i	- iv
Results at a Glance		v - vi
Report of Directors	vii - xv
Report of external consultants on Board Appraisal			xvi
Statement of Director's responsibilities			xvii
Statement of Corporate responsibilities			xviii
Environmental, Social and Governance (ESG) Report			xix
Report of the Audit and Compliance Committee			xx
Report of the Independent Auditors			1 - 5
Statement of Material Accounting Policies		6	- 25
Statement of IFRS 17 Accounting Policies	26	- 38
Statement of Financial Position-Transition	39	- 42
Statement of Profit or Loss and other Comprehensive
Income-Transition	43	- 44
Notes to Transition Adjustment	45	- 48
Statement of financial position			49
Statement of profit or loss and other comprehensive
income			50
Statement of Change in Equity	51	- 52
Statement of Cash Flows			53
Notes to the Financial Statements	54	- 82
Segments Report	83	- 93
Claim Development Table	94	- 97
Estimates of undiscounted gross cumulative claims			98
Financial Risk Management Policy	99	- 131
Capital Management Policy	132	- 133
Asset & Liability Management	134	- 135
Other National Disclosures			136
Statement of Value Added	137	- 138
Group Financial Summary	139	- 140
Parent Financial Summary	141	- 142
Free float disclosure	143	- 144

NEM INSURANCE PLC		i
ANNUAL REPORT, 31 DECEMBER 2023
Corporate Information
Directors	Mr. Tope Smart	Group Chairman (With effect from 1st Aug 2023)
	Mr. Andrew Ikekhua	Managing Director (With effect from 3rd July 2023)
	Mr. Idowu Semowo	Executive Director (With effect from 16th Aug 2023)
	Alh. Ahmed Yakasai	Independent Director
	Mrs. Joy Teluwo	Non-Executive Director
	Mr. Papa Ndiaye	Non-Executive Director
	Mr. Kelechi Okoro	Non-Executive Director
	Dr. Daphne Dafinone	Non-Executive Director (With effect from 1st Sept 2023)
	Chief (Dr) Anthony Aletor	Non-Executive Director (With effect from 1st Sept 2023)
	Mrs. Abisola Giwa-Osagie	Non-Executive Director (With effect from 1st Oct 2023)
Company Secretary	Mrs. Ifunanya Iwuagwu
	199, Ikorodu Road
	Obanikoro, Lagos
Registered Office	NEM House
	199, Ikorodu Road
	Obanikoro, Lagos
FRCN Number	FRC/2012/0000000000249
Registration Number	6971
Tax Identification Number	00010019-0001
Corporate Head Office	NEM House
	199, Ikorodu Road
	Obanikoro, Lagos
Registrars	APEL Capital & Trust Limited
	8, Alhaji Bashorun Street
	Off Norman Williams Crescent,
	South West, Ikoyi
	Lagos
	Tel: [phone]
	Mobile No: 07046126698
Bankers	Access Bank Plc
	Polaris Bank Limited
	First City Monument Bank
	Ecobank Nigeria Limited
	First Bank of Nigeria Limited
	Guaranty Trust Bank Limited
	Keystone Bank Limited
	Standard Chartered Bank Nigeria Limited
	Sterling Bank Plc
	United Bank for Africa Plc
	Stanbic IBTC Plc
	Heritage Bank Limited
	Fidelity bank Plc
	Zenith Bank Plc
Auditors	KPMG Professional Services
	KPMG Towers,
	Bishop Aboyade Cole Street,

Victoria Island,

www.home.kpmg/ng

NEM INSURANCE PLC	ii
ANNUAL REPORT, 31 DECEMBER 2023
Corporate Information (Cont'd)
Solicitors	Koya & Kuti Solicitors
	5th Floor, 3, Ajele Street,
	Lagos.
	Sola Abidakun & Co
	186A, Igbosere Road,
	Lagos Island, Lagos.
	Adeboye Badejo & Co
	15, Salami street,
	Off Sojomein Talabi Avenue,
	Ajuwon, Lagos.
	A & M Legal Practitioners
	Plot 2, Block B, Palms,
	Residences estate,
	Lekki Phase II, Lagos.
Reinsurers	African Reinsurers Corporation
	Continental Reinsurance Corporation
	SWISS Reinsurance Company
	WAICA Reinsurance Pool
Subsidiaries	NEM Asset Management Ltd
	199, Ikorodu Road, Obanikoro,
	Lagos.
	P.O. Box 654
	Tel: [phone]
	NEM Health Limited
	199, Ikorodu Road, Obanikoro,
	Lagos.
	P.O. Box 654
	Tel: [phone]
Branch Networks	Abuja - Garki
	78, Emeka Anyaogu,
	Off Muhammadu Buhari Way,
	Area 11, Garki, Abuja.
	Branch Manager: Michael A. Giwa
	Mobile No: 08033208141

Abuja - Wuse

Plot 548, Ejura Close, Wuse II, Abuja

Branch Manager: Mr. Martins Ilegoma

Mobile Nos: 08077284843 08078153184, 08037020262

Abuja - Central Business District 82, Imo State Liaison office Opp. Federal Ministry of Finance Central Business District Branch Manager: Davies O. Dada Mobile Nos: 08150849411

Apapa 2nd Floor 41/43 Itire Road Surulere, Lagos

Tel: [phone]

Branch Manager: Uzor Enubuzo

Mobile No: 08059301673, 0802896842

NEM INSURANCE PLC	iii
ANNUAL REPORT, 31 DECEMBER 2023
Corporate Information (Cont'd)
Calabar
2nd Floor, 26, Etta-Agbor Road
Calabar
Cross River
Branch Manager: Opeoluwa Olaku
Mobile Nos: 08054642551, 08033542048
Akure
3rd Floor, BIO Building Alagabaka
Akure, Ondo State
Tel: [phone]
Branch Manager: Kehinde Agbelade
Mobile No: 08033509419
Ibadan
3rd Floor, Broking House
1, Alhaji Jimoh Odutola Street
PMB 5328, Ibadan
Oyo State
Tel: [phone]
Branch Manager: Rufus Olumide
Mobile Nos: 08033463697
Jos
10, Rwang Pam Street
P.O. Box 1261
Jos, Plateau State
Tel: [phone]
Branch Manager: Oyeronke Oyegbamile-Bello
Mobile No: 08077284946
Lagos Mainland
199, Ikorodu Road
Obanikoro, Lagos
Tel: [phone]
Branch Manager: Lucky Okparavero
Mobile Nos: 08076175287, 08023123006
08077284829
Kano
3rd Floor, Union Bank Building
37, Niger Street
P.O. Box 1185, Kano
Tel: [phone]
Branch Manager: Ahmed Bello
Mobile No: 08154971638
08065294000
Onitsha
2nd Floor, (AIB) Building
107, Upper New Market Road, Onitsha
Tel: [phone]
Branch Manager: Cyracus Akujobi
Mobile Nos: 08033457426, 07029219983

NEM INSURANCE PLC	iv
ANNUAL REPORT, 31 DECEMBER 2023
Corporate Information (Cont'd)
	Kaduna
	Ground Floor, Turaki Ali House
	3, Kanata Road
	P.O Box 822, Kaduna
	Tel: [phone]
	Branch Manager: Eyitayo Ogboyomi
	Mobile Nos: 07028243118
	Oshogbo
	1st Floor, Former Afribank Building
	Opposite Fakunle Comprehensive High School
	Fakunle, Gbongan/Ibadan Road
	Osogbo, Osun Sate
	Tel: [phone]
	Branch Manager: Olubiyi Sonoiki
	Mobile Nos: 08038436231, 08077284898
	Warri
	57, Effurun, Sapele Road
	Effurun, Delta State
	Branch Manager: Olayide Akinola
	Mobile No: 08034221374 0802388188
	Port Harcourt
	House 2, Road 2
	Circular Road, Residential Estate
	Port Harcourt, Rivers State
	Tel: [phone]
	Branch Manager: Akintan Kolawole
	Mobile Nos: 08037236009
	Anthony Retail
	6A, Oyetola Idowu Street,
	Sura Mogaji,
	Ilupeju, Lagos
	Branch Manager: Charity Orisakwe
	Mobile Nos: 08033158144
Our Vision	To be the preferred choice of the insuring public
Our Mission	To build a customer-satisfying Insurance Institution that is passionate about adding value to
	the interests of all stakeholders.
Core Values	Discipline
	Integrity
	Humility
	Excellence
	Empathy
	Courage

NEM INSURANCE PLC					v
ANNUAL REPORT 31 DECEMBER 2023
GROUP RESULTS AT A GLANCE	2023	2022
			Restated
				Changes	Changes
FINANCIAL POSITION	N'000		N'000	N'000	%
Cash and cash equivalents	8,002,993	8,878,011	(875,018)	(10)
Financial assets:
- At fair value through profit or loss	10,463,494	5,800,623	4,662,871	80
- At fair value through other comprehensive income	75,219	53,731	21,488	40
- At amortised cost	36,355,234	12,159,020	24,196,214	199
Insurance contract assets	-	-	-	-
Trade Receivable	450,143	672,356	(222,213)	(33)
Reinsurance contract assets	9,433,042	9,472,703	(39,661)	(0)
Other receivables and prepayments	2,148,365	723,429	1,424,936	197
Investment properties	2,353,946	1,813,768	540,178	30
Statutory deposit	320,000	320,000	(0)	(0)
Intangible asset	54,110	15,721	38,389	244
Property, Plant and Equipment	4,202,175	3,886,188	315,987	8
Right-of-use Assets	609,015	149,520	459,495	307
Deferred tax asset	-		252,724	(252,724)	(100)
Total Assets	74,467,735	44,197,794
				10,611,558	72
Insurance contract liabilities	25,285,724	14,674,166
Reinsurance contract liabilities	-	-	-	-
Other insurance contract liabilities	857,381	487,527	369,853	76
Borrowings	1,557,737	-	1,557,737	100
Other payables	2,093,470	1,575,721	517,749	33
Lease liabilities	473,241	35,999	437,242	1,215
Retirement benefit obligations	-	29,497	(29,497)	(100)
Income tax liability	1,155,152	379,224	775,928	205
Deferred tax	4,507,627		-	4,507,627	100
Total Liabilities	35,930,332		17,182,134
Share capital	5,016,477	5,016,477	-	-
Statutory contingency reserve	9,837,510	7,186,595	2,650,915	37
Retained earnings	21,578,802	12,713,807	8,864,995	70
FVOCI reserve	(46,277)	(67,765)	21,488	(32)
Asset revaluation reserve	2,107,964	2,107,964	-	-
Other Reserves - gratuity	-	58,581	(58,581)	(100)
Insurance finance reserve	-	-	-	-
Non-controlling interest	42,927		-	42,927	100
Total Equity	38,537,403	27,015,659
INCOME STATEMENT	N'000		N'000	N'000	%
Insurance Revenue	52,112,435	31,433,600	20,678,835	66
Insurance Service expenses	(34,218,973)	(22,693,835)	(11,525,138)	51
Net expenses on Reinsurance contracts	(12,795,475)		(2,480,675)	(10,314,800)	416
Insurance Service Result	5,097,987	6,259,090	(1,161,103)	(19)
Interest revenue calculated using the effective interest method	2,649,191	1,085,092	1,564,099	144
Dividend Income	687,422	470,062	217,360	46
Net foreign exchange gain	11,388,625	297,149	11,091,476	3,733
Net Fair value gain	4,807,948	174,088	4,633,860	2,662
Net credit impairment losses	(213,317)		(18,927)	(194,390)	1,027
Net Investment result	19,319,869	2,007,464	17,312,405	862
Net Insurance finance expenses	(154,305)		(88,578)	(65,727)	74
Net Insurance and Investment result	24,263,551	8,177,976	16,085,575	197
Other operating income	242,610	1,081,234	(838,624)	(78)
Gain/(loss) on disposal of property, plant and equipment	13,657	(36,425)	50,082	(137)
Management expenses	(5,279,154)	(3,724,696)	(1,554,458)	42
Finance cost	(362,809)		-	(362,809)	100
Profit before taxation	18,877,855	5,498,089	13,379,765	243
Income taxes	(5,929,070)		(96,667)	(5,832,403)	6,033
Profit for the year after tax	12,948,785	5,401,422	7,547,363	140
Total other comprehensive income/(loss) for the year	10,025	(45,067)	55,092	(122)
	12,958,810		5,356,355	7,602,455	142
Profit attributable to Equity holders of the parent
13,020,855		5,401,422	7,619,433	141
Loss attributable to Non controlling interest	(72,073)		-
Basic earnings per share (Kobo)				152	141
260	108
Diluted earnings per shares (Kobo)				152	141
260	108

NEM INSURANCE PLC					vi
ANNUAL REPORT 31 DECEMBER 2023
PARENT RESULTS AT A GLANCE	2023	2022
			Restated
				Changes	Changes
FINANCIAL POSITION	N'000		N'000	N'000	%
Cash and cash equivalents	7,907,551	8,842,182	(934,631)	(11)
Financial assets:
- At fair value through profit or loss	10,463,494	5,800,623	4,662,871	80
- At fair value through other comprehensive income	75,219	53,731	21,488	40
- At amortised cost	36,355,234	12,159,020	24,196,214	199
Insurance contract assets	-	-	-	-
Trade Receivable	354,531	672,356	(317,825)	(47)
Reinsurance contract assets	9,433,042	9,472,703	(39,661)	(0)
Other receivables and prepayments	1,875,423	581,362	1,294,060	223
Investment in Subsidiary	435,000	150,000
Investment properties	2,353,946	1,813,768	540,178	30
Statutory deposit	320,000	320,000	-	-
Intangible asset	42,161	15,721	26,440	168
Property, Plant and Equipment	4,059,350	3,878,192	181,158	5
Right-of-use Assets	609,015	149,520	459,495	307
Deferred tax asset	-		249,881	(249,881)	(100)
Total Assets	74,283,965	44,159,059
				10,423,681	71
Insurance contract liabilities	25,097,847	14,674,166
Reinsurance contract liabilities	-	-	-	-
Other insurance contract liabilities	783,901	487,527	296,374	61
Borrowings	1,557,737	-	1,557,737	100
Other payables	2,015,522	1,570,560	444,962	28
Lease liabilities	473,241	35,999	437,242	1,215
Retirement benefit obligations	-	29,497	(29,497)	(100)
Income tax liability	1,154,348	378,179	776,170	205
Deferred tax liabilities	4,505,697		-	4,505,697	100
Total Liabilities	35,588,294		17,175,928
Share capital	5,016,477	5,016,477	-	-
Statutory contingency reserve	9,837,510	7,186,595	2,650,915	37
Retained earnings	21,779,997	12,681,279	9,098,718	72
FVOCI reserve	(46,277)	(67,765)	21,488	(32)
Asset revaluation reserve	2,107,964	2,107,964	-	-
Other Reserves - gratuity	-	58,581	(58,581)	(100)
Insurance finance reserve	-		-	-	-
Total Equity	38,695,671	26,983,131
INCOME STATEMENT	N'000		N'000	N'000	%
Insurance Revenue	51,993,997	31,433,600	20,560,397	65
Insurance Service expenses	(34,116,367)	(22,693,835)	(11,422,532)	50
Net expenses on Reinsurance contracts	(12,795,475)		(2,480,675)	(10,314,800)	416
Insurance Service Result	5,082,155	6,259,090	(1,176,935)	(19)
Interest revenue calculated using the effective interest method	2,648,134	1,085,092	1,563,042	144
Dividend Income	687,422	470,062	217,360	46
Net foreign exchange gain	11,388,625	297,149	11,091,476	3,733
Net Fair value gain	4,807,948	174,088	4,633,860	2,662
Net credit impairment losses	(213,317)		(18,927)	(194,390)	1,027
Net Investment result	19,318,812	2,007,464	17,311,348	862
Net Insurance finance expenses	(154,305)		(88,578)	(65,727)	74
Net Insurance and Investment result	24,246,662	8,177,976	16,068,686	196
Other operating income	180,117	1,027,743	(847,626)	(82)
Gain/(loss) on disposal of property, plant and equipment	13,657	(36,425)	50,082	(137)
Management expenses	(4,912,943)	(3,673,499)	(1,239,444)	34
Finance cost	(348,772)		-	(348,772)	100
Profit before taxation	19,178,721	5,495,795	13,682,926	249
Income taxes	(5,924,145)		(94,941)	(5,829,204)	6,140
Profit for the year after tax	13,254,576	5,400,854	7,853,722	145
Total other comprehensive income/(loss) for the year	10,025	(45,067)	55,092	(122)
	13,264,601		5,355,787	7,908,814	148
Profit attributable to Equity holders of the parent
13,254,576		5,400,854	7,853,722	145
Basic earnings per share (Kobo)	264	108	157	145
Diluted earnings per shares (Kobo)				157	145
264	108

NEM INSURANCE PLC	vi
ANNUAL REPORT, 31 DECEMBER 2023
REPORT OF DIRECTORS

The directors hereby present their annual reports on the affairs of NEM Insurance Plc ("the Company" or "the Parent") together with its subsidiaries ("the Group") Group and Company's consolidated and seperate financial statements with the independent auditor's report for the year ended 31 December 2023.

1. Legal form
   The company was incorporated in 1970 as a Nigerian Company in accordance with the Companies Act of 1968. The company became listed on the Nigerian Stock Exchange in 1989 following its privatization by the Federal Government of Nigeria. The company was into Life and Non- Life business but following the recapitalization exercise in 2007, the company merged with Vigilant Insurance Company Ltd to transact all classes of General Insurance.
2. Principal activities and corporate development
   The Company is engaged in the business of General Insurance which includes marine and aviation, motor vehicle, fire and burglary, oil and gas, engineering, bond, general accident, and agricture. The company has one wholly owned subsidiary: NEM Asset Management Company limited, and one partially owned subsidiary: NEM Health limited. NEM Asset Management company limited was incorporated on 11 July 2008 but commenced business in March 2016 to engage in investment business of all kinds including Vehicle Leasing, Machinery Acquisition, Hire Purchase of diverse assets etc. NEM Health limited was incorporated by NEM Insurance Plc on 22 November 2022 but commenced business in May 2023, and engages in the provision of health care services through health care providers and for that purpose is accredited by the National Health Insurance Authority.There have been no material changes to the group's business from the previous year.

SUMMARY OF THE RESULT	Group		Parent
Operating result	2023	2022	2023	2022
		Restated		Restated
	N'000	N'000	N'000	N'000
Insurance Revenue	52,112,435	31,433,600	51,993,997	31,433,600
Investment Result	19,319,869	2,007,464	19,318,812	2,007,464
Other revenue	256,267	1,044,809	193,774	991,318
Total Revenue	71,688,571	34,485,873	71,506,583	34,432,382
Insurance Service expenses	34,218,973	22,693,835	34,116,367	22,693,835
Net expenses on Reinsurance contracts	12,795,475	2,480,675	12,795,475	2,480,675
Net insurance finance expenses	154,305	88,578	154,305	88,578
Management and other expenses	5,279,154	3,724,696	4,912,943	3,673,499
Finance cost	362,809	-	348,772	-
Total Insurance and other expenses	52,810,716	28,987,784	52,327,862	28,936,587
Profit before tax	18,877,855	5,498,089	19,178,721	5,495,795
Income tax expense	(5,929,070)	(96,667)	(5,924,145)	(94,941)
Profit For the Year	12,948,785	5,401,422	13,254,576	5,400,854
Other Comprehensive income/(loss) for the
year	10,025	(45,067)	10,025	(45,067)
Total comprehensive income for the year	12,958,810	5,356,355	13,264,601	5,355,787
Basic Earnings Per Share (Kobo)	260	108	264	108
Diluted Basic Earnings Per Share (Kobo)	260	108	264	108
Profit attributable to Equity holders of the	13,020,855	5,401,422	13,254,576	5,400,854
parent
Loss attributable to Non-controlling interest	(72,073)	-	-	-

3. Dividend

Subsequent to the year-end and subject to approval at the next annual general meeting, the directors proposed a final dividend of 60 kobo per share (2022: 30 kobo) on the issued and paid-up capital of N5bn (2022: N5bn) ordinary shares of N=1.00 each for the year ended 31 December 2023 (see note 21). This amounts to N=3bn (2022: N=1.5bn) and this final dividend has not been reflected in the financial statements. Payment of dividends is subject to withholding tax at the rate of 10% in the hands of the recipient.

NEM INSURANCE PLC	vii
ANNUAL REPORT, 31 DECEMBER 2023
REPORT OF DIRECTORS (CONT'D)

4. Introduction

The business of NEM Insurance Plc is conducted under a corporate governance structure that incorporates the Board, the Committees, and a functional Management System with the Board as the apex decision making body. This is in accordance with the Code of Corporate Governance for the Insurance industry in Nigeria, the Securities and Exchange Commission (SEC) Code of Corporate Governance and best practices. "At NEM Insurance Plc, we have ensured that our business activities are implicitly transparent".

For the financial year under review, 2023; the Board is of the opinion that NEM Insurance Plc has in all material respects, complied with the requirements of the Code of Corporate Governance for Insurance industry in Nigeria.

A summary of the key components of our Corporate Governance System is provided hereunder.

THE BOARD OF DIRECTORS

The Board of the Company is responsible for establishing the policy framework that would ensure that the Company fully discharges its legal, financial, as well as regulatory responsibilities. The Board monitors the performance of the Company, monitors the effectiveness of the Governance Structure under which it operates and renders the Accounts of its stewardship of the organization's resources to the shareholders. The Board of Directors of the Company is composed of a mix of non- executives and executives whereby the number of non-executives exceeds the number of executives while the position of the Chairman of the Board is clearly delineated from the Chief Executive Officer.

The Chairman

The Chairman of NEM Insurance Plc was duly appointed. The Chairman's primary role is to ensure that the board carries out its governance role in the most effective manner. The Chairman manages the operations of the Board effectively to ensure that members made concrete contributions towards the decisions of the Board and that the Board operates in harmony.

The Chief Executive Officer

The CEO monitors the day-to-day operations of the Company and its strategic and financial plans with the cooperation and support of the Board. The CEO ensures transparency and the effective operation and management of the Company's resources to ensure profitability of its operations and that all significant matters affecting the Company are brought to the attention of the Board.

Independent Director

The Board appointed an Independent Director who remained independent since appointment.

Annual Board Appraisal

In accordance with the requirements of the NAICOM Code, the Board renewed the mandate of SIAO partners to conduct the appraisal of its performance for 2023. The Board embarked on implementation of some of the recommendations of the last Appraisal Report.

1. ACTIVITIES OF THE BOARD
   The Board meets regularly to discuss critical issues affecting the organization and performs other responsibilities that fall within its purview as provided in the Company's Article of Association and by other relevant regulatory authorities. Meetings were well attended with sufficient notice given well in advance of the meetings. Sufficient time was also allotted to meetings as required to cover the items on the Agenda.
   Composition of the Board/Schedule of Attendance at Meetings
   A total of 5 Board meetings were held during the year 2023. Meetings were held on 13th March, 27th April, 16th August, 26th October, and 13th December. A breakdown of the composition of the board and their attendance of the meetings is highlighted below.

Name of Director	Status	Meetings Held	Meetings
			Attended
Mr. Tope Smart	Chairman**	5	5
Dr. Fidelis Ayebae	Chairman (Retired) *	5	2
Mr Andrew Ikekua	Managing Director/CEO***	5	5
Mr. Idowu Semowo	Executive Director (New) ****	5	3
Alhaji Ahmed I. Yakasai	Independent Non-Executive Director	5	4