Dear Esteemed Shareholders, On behalf of the Board of Directors of Sterling Assurance Nigeria Limited, I am pleased to present the Annual Report and Audited Financial Statements of the Company for the year ended 31st December 2025. The Nigerian economy in 2025 continued to adjust to the reforms implemented in preceding years. While inflationary pressures remained elevated and businesses continued to contend with rising operating costs, the foreign exchange market exhibited greater stability compared with prior years, contributing to improved business planning and investor confidence. The year 2025 marked a significant turning point for our Company. Sterling Assurance Nigeria Limited demonstrated remarkable resilience and achieved one of its strongest performances in recent years. The results recorded during the year reflect the effectiveness of the strategic decisions taken by the Board to strengthen our operations, improve profitability, optimise our investment portfolio, and position the Company for Dear Esteemed Shareholders, on behalf of the Board of Directors of Sterling Assurance Nigeria Limited, I am pleased to present the Annual Report and Audited Financial Statements of the Company for the year ended 31st December 2025. The Nigerian economy in 2025 continued to adjust to the reforms implemented in preceding years. While inflationary pressures remained elevated and businesses continued to contend with rising operating costs, the foreign exchange market exhibited greater stability compared with prior years, contributing to improved business planning and investor confidence. The year 2025 marked a significant turning point for our Company. Sterling Assurance Nigeria Limited demonstrated remarkable resilience and achieved one of its strongest performances in recent years. The results recorded during the year reflect the effectiveness of the strategic decisions taken by the Board to strengthen our operations, improve profitability, optimise our investment portfolio, and position the Company for long-term sustainable growth.
OPERATING ENVIRONMENT
The Nigerian economy continued its transition t h r o u g h a p e r i o d of significant reforms during 2025. While these reforms created short-term pressures on businesses, they also laid the foundation for greater economic efficiency and long-term growth. The insurance industry o p e r a t e d w i t h i n a n environment of increasing r e g u l a t o r y o v e r s i g h t ,technological advancement, and changing customer expectations. The need for stronger capitalisation,improved risk management practices and enhanced o p e r a t i o n a l e ffi c i e n c y became more pronounced across the industry. Against this backdrop, policyholders, shareholders and other stakeholders while maintaining sound corporate governance and prudent risk management practices.
REGULATORY DEVELOPMENTS AND THE NIGERIA INSURANCE INDUSTRY REFORM ACT (NIIRA) 2025
One of the most significant developments in the insurance industry during the year was the emergence of the Nigeria Insurance Industry Reform Act (NIIRA) 2025, which introduces a more modern and robust regulatory framework for the insurance sector. Among the key provisions of the Act is the increase in the minimum capital requirement for non-life insurance companies from 3 billion to 15 billion. Of particular importance is the transition towards a Risk-Based Capital framework. This reform represents a major shift from the traditional fixed minimum capital regime to a more risk-sensitive capital model that aligns capital requirements with the nature, scale and complexity of risks assumed by insurance companies. The Board welcomes these reforms as they are expected to strengthen the industry's resilience, improve policyholder protection, promote sound risk management practices and enhance investor confidence in the insurance sector. We believe that institutions that embrace these reforms pro-actively will be best positioned to thrive in the emerging insurance landscape.
CAPITAL STRENGTHENING INITIATIVES
In recognition of this new regulatory threshold and in furtherance of our commitment to maintaining a strong and well-capitalized institution, the Board undertook strategic capital enhancement initiatives during the year. As part of these initiatives, the Company successfully raised the sum of 15,815,718 through a Rights Issue, demonstrating the confidence of existing shareholders in the future of Sterling Assurance. In addition, the Company received a strategic capital injection of 12,000,000,000 from STERLING ASSET MANAGEMENT AND TRUSTEE LIMITED, thereby reinforcing her financial position and providing additional capacity to pursue future growth opportunities. These capital enhancement initiatives have significantly improved our capital adequacy position and further strengthened our preparedness for the implementation of Risk-Based Capital requirements under NIIRA.
We did not merely raise capital to meet a regulatory requirement; we raised capital to create a stronger Sterling Assurance capable of writing larger risks, protecting policyholders, improving profitability and delivering sustainable returns to shareholders.
FINANCIAL PERFORMANCE
I am delighted to report that the Company delivered a strong financial performance during the year under review. Insurance Revenue increased by 22.97% from 8.88 billion in 2024 to 10.92 billion in 2025. This growth was driven by improved business retention, disciplined underwriting activities and increased market penetration across our key lines of business. The Company's Insurance Service Result improved significantly from a loss of 1.13 billion in 2024 to a surplus of 2.69 billion in 2025, reflecting stronger underwriting performance and effective claims management. Profit Before Tax increased substantially to 980 million from 170 million in the previous year, while Profit After Tax rose to 641.7 million compared to 24 million recorded in 2024. Shareholders' Funds increased to 8.37 billion, representing a significant improvement over the prior year's position and underscoring the Company's growing financial strength. The Company's liquidity position also remained strong, with Cash and Cash Equivalents increasing to 6.558 billion at year-end from N2.979 billion in 2024, thereby enhancing capacity to meet obligations to policyholders and support future growth initiatives.
STRATEGIC INITIATIVES
During the year, Management continued to execute initiatives aimed at enhancing operational efficiency, strengthening customer relationships and improving overall business performance. We continued to invest in technology, process improvements, talent development and customer service enhancement. These initiatives are intended to improve operational effectiveness, accelerate service delivery, and create a superior customer experience. The Board remains committed to supporting initiatives that drive innovation, improve productivity and sustain profitability.
CORPORATE GOVERNANCE AND RISK MANAGEMENT
The Board remains committed to the highest standards of corporate governance, accountability, transparency, and ethical conduct. Our governance framework continues to provide effective oversight of the Company's operations while ensuring compliance with applicable laws, regulations and industry best practices. As regulatory expectations evolve towards risk-based supervision, we continue to strengthen our enterprise risk management framework to ensure that risks are appropriately identified, measured, monitored and managed across the organisation.
OUTLOOK
Looking ahead to 2026 and beyond, we remain optimistic about the future of Sterling Assurance. The Company's strategic priorities will continue to focus on profitable growth, capital optimisation, digital transformation, customer-centric innovation, and operational excellence.With a stronger capital base, improved profitability, sound governance structures and a dedicated workforce, we are confident that Sterling Assurance is well positioned to take advantage of emerging opportunities within the Nigerian insurance market and create sustainable value for all stakeholders.
APPRECIATION
On behalf of the Board, I express our sincere gratitude to our shareholders for their unwavering support, confidence and commitment to the Company. I also thank our valued customers, brokers, agents, reinsurers, regulators, business partners and other stakeholders for their continued trust and collaboration. I particularly acknowledge the dedication and professionalism of the Management team and staff whose hard work and commitment contributed significantly to the Company's achievements during the year. Together, we shall continue to build a stronger, more resilient and more prosperous Sterling Assurance Nigeria Limited. Thank you. Long-term sustainable growth.
OPERATING ENVIRONMENT
The Nigerian economy continued its transitiont h r o u g h a p e r i o d o f significant reforms during 2025. While these reforms created short-term pressures on businesses, they also laid the foundation for greater economic efficiency and long-term growth. The insurance industry o p e r a t e d w i t h i n a n environment of increasing r e g u l a t o r y o v e r s i g h t , technological advancement, and changing customer expectations. The need for stronger capitalisation, improved risk management practices and enhanced o p e r a t i o n a l e ffi c i e n c y became more pronounced across the industry. Against this backdrop,policyholders, shareholders and other stakeholders while maintaining sound corporate governance and prudent risk management practices.
REGULATORY DEVELOPMENTS AND THE NIGERIA INSURANCE INDUSTRY REFORM ACT (NIIRA) 2025
One of the most significant developments in the insurance industry during the year was the emergence of the Nigeria Insurance Industry Reform Act (NIIRA) 2025, which introduces a more modern and robust regulatory framework for the insurance sector. Among the key provisions of the Act is the increase in the minimum capital requirement for non-life insurance companies from ?3 billion to ?15 billion. Of particular importance is the transition towards a Risk-Based Capital framework. This reform represents a major shift from the traditional fixed minimum capital regime to a more risk-sensitive capital model that aligns capital requirements with the nature, scale and complexity of risks assumed by insurance companies. The Board welcomes these reforms as they are expected to strengthen the industry's resilience, improve policyholder protection, promote sound risk management practices and enhance investor confidence in the insurance sector. We believe that institutions that embrace these reforms pro-actively will be best positioned to thrive in the emerging insurance landscape.
CAPITAL STRENGTHENING INITIATIVES
In recognition of this new regulatory threshold and in furtherance of our commitment tomaintaining a strong and well-capitalised institution, the Board undertook strategic capital enhancement initiatives during the year. As part of these initiatives, the Company successfully raised the sum of 15,815,718 through a Rights Issue, demonstrating the confidence of existing shareholders in the future of Sterling Assurance. In addition, the Company received a strategic capital injection of 12,000,000,000 from STERLING ASSET MANAGEMENT AND TRUSTEE LIMITED, thereby reinforcing her financial position and providing additional capacity to pursue future growth opportunities. These capital enhancement initiatives have significantly improved our capital adequacy position and further strengthened our preparedness for the implementation of Risk-Based Capital requirements under NIIRA. We did not merely raise capital to meet a regulatory requirement; we raised capital to create a stronger Sterling Assurance capable of writing larger risks, protecting policyholders, improving profitability and delivering sustainable returns to shareholders.
FINANCIAL PERFORMANCE
I am delighted to report that the Company delivered a strong financial performance during the year under review.Insurance Revenue increased by 22.97% from 8.88 billion in 2024 to 10.92 billion in 2025. This growth was driven by improved business retention, disciplined underwriting activities and increased market penetration across our key lines of business. The Company's Insurance Service Result improved significantly from a loss of 1.13 billion in 2024 to a surplus of 2.69 billion in 2025, reflecting stronger underwriting performance and effective claims management. Profit Before Tax increased substantially to 980 million from 170 million in the previous year, while Profit After Tax rose to 641.7 million compared to 24 million recorded in 2024.
Shareholders' Funds increased to 8.37 billion, representing a significant improvement over the prior year's position and underscoring the Company's growing financial strength. The Company's liquidity position also remained strong, with Cash and Cash Equivalents increasing to 6.558 billion at year-end from N2.979 billion in 2024, thereby enhancing capacity to meet obligations to policyholders and support future growth initiatives.
STRATEGIC INITIATIVES
During the year, Management continued to execute initiatives aimed at enhancing operational efficiency, strengthening customer relationships and improving overall business performance.We continued to invest in technology, process improvements, talent development and customer service enhancement. These initiatives are intended to improve operational effectiveness, accelerate service delivery, and create a superior customer experience. The Board remains committed to supporting initiatives that drive innovation, improve productivity and sustain profitability.
CORPORATE GOVERNANCE AND RISK MANAGEMENT
The Board remains committed to the highest standards of corporate governance, accountability, transparency, and ethical conduct. Our governance framework continues to provide effective oversight of the Company's operations while ensuring compliance with applicable laws, regulations and industry best practices. As regulatory expectations evolve towards risk-based supervision, we continue to strengthen our enterprise risk management framework to ensure that risks are appropriately identified, measured, monitored and managed across the organisation.
OUTLOOK
Looking ahead to 2026 and beyond, we remain optimistic about the future of Sterling Assurance. The Company's strategic priorities will continue to focus on profitable growth, capital optimisation, digital transformation, customer-centric innovation, and operational excellence. With a stronger capital base, improved profitability, sound governance structures and a dedicated workforce, we are confident that Sterling Assurance is well positioned to take advantage of emerging opportunities within the Nigerian insurance market and createsustainable value for all stakeholders.
APPRECIATION
On behalf of the Board, I express our sincere gratitude to our shareholders for their unwavering support, confidence and commitment to the Company. I also thank our valued customers, brokers, agents, reinsurers, regulators, business partners and other stakeholders for their continued trust and collaboration. I particularly acknowledge the dedication and professionalism of the Management team and staff whose hard work and commitment contributed significantly to the Company's achievements during the year. Together, we shall continue to build a stronger, more resilient and more prosperous Sterling Assurance Nigeria Limited.
Thank you.