The state owned giant Ethiopian Insurance Company (EIC), suffered a decline in its insurance coverage decreasing down to 8.4 Billion Birr in the just ended budget year. The decline in insurance coverage resulted in the Insurer’s overall market share to drop to 41 percent.

On Friday, August 29, 2014, the insurance company held a management meeting at Addis Ababa Hilton. During the meeting it was revealed number of insurance policies sold and renewed during the 2013/2014 fiscal year has declined by 47.7 percent.

However, the gross profit of the company shows increase and recorded a total of 446 Million Birr. This figure shows an increase in 102.5 Million Birr when compared to the year previous it.

The premium collection by EIC also shows a decline. It recorded some two Billion Birr from premium which is 183.4 Million Birr lower when compared to the previous year. This is an 8.5 percent decrease when compared to the 2012/2013 year and 23.8 percent lower than what the company targeted for.

During the meeting it was disclosed 726.7 Million Birr was paid as compensation to its customers, out of which 94.8 percent was channeled to general insurance services.

It was only in the 2012/2013 fiscal year EIC reported expansion of its insurance coverage to a record high one Trillion Birr. During this budget year the Insurer managed to earn a 343.4 Million Birr net profit.

According to The Reporter, EIC has in the last three years lost over 10 percent of its market share.

Ethiopian Insurance Company was established in 1976 after combining the 13 private insurance companies that were nationalized by the Derg.

Source: The Reporter