Face to Face: Neco Insurance Vs Premier Insurance 

November 19, 2019 | Investopaper

Neco Insurance and Premier Insurance were once in the merger agreement which was canceled. Several years have passed and both the insurance companies have progressed rapidly. These two insurance have grown their capital by almost tenfold after the merger agreement was called off.

Here we will try to compare the performance of these two non-life insurance companies based on the unaudited first-quarter report of the fiscal year 2076/77. The financial comparison will be based on the following indicators.

Paid-up Capital, Reserve & Surplus, Insurance Fund

As of the first quarter, Neco Insurance has a paid-up capital of Rs. 117.63 crores while Premier Insurance capital stands at Rs. 107.46 crores. Similarly, Neco Insurance leads in total reserve as well as the insurance fund with Rs. 49.76 crores and Rs. 64.51 crores respectively. On the other hand, Premier Insurance reserve & surplus stand at Rs. 19.86 crores while the insurance fund is Rs. 52.75 crores.

Total Premium & Net Premium

In terms of both the total premium & net premium income, Neco Insurance is ahead of Premier Insurance. Neco has collected a total premium of Rs. 56.03 crores until the first quarter. Likewise, the net premium is at Rs. 33.13 crores. Up to the first quarter of this fiscal year, Premium insurance has a total premium and net premium of Rs. 43.09 crores and Rs. 21 crores respectively.

Net Claim & Total Outstanding Claim

Premier Insurance has paid a higher net claim of Rs. 13.01 crores whereas Neco Insurance net claim payment stands at Rs. 10.11 crores. Likewise, Neco Insurance has a lower total outstanding claim of Rs. 39.78 crores. On the other hand, Premier Insurance has a whopping Rs. 185.98 crores, that is to be paid.

Total Investments

Neco Insurance again exceeds Premier in terms of total investments. The total investments (long term & short term) of Neco and Premier stand at Rs. 291.29 crores and Rs. 263.98 crores until the first quarter.

Net Profit, Earnings Per Share & Networth Per Share

In the first three months of this fiscal year, Neco has generated a net profit of Rs. 7.53 crores which turn into the annualized EPS of Rs. 22.81. On the other hand, Premier Insurance earned Rs. 5.78 crores with EPS of Rs. 21.53.

Likewise, Neco Insurance has a higher per-share net worth of Rs. 202.30 while Premier has a net worth per share of Rs. 172.12.

Also Read: Best Non-Life Insurance Companies In Nepal

The financial comparison of Neco Insurance and Premier Insurance is also summarized in the table below:

Face to Face: Neco Insurance Vs Premier Insurance

HEADINGS Neco Insurance Premier Insurance
Paid-up Capital (Rs. ‘crores’) 117.63 107.46
Reserve & Surplus (Rs. ‘crores’) 49.76 19.86
Insurance Fund  (Rs. ‘crores’) 64.51 52.75
Total Investments  (Rs. ‘crores’) 291.29 263.98
Total Premium (Rs. ‘crores’) 56.03 43.09
Net Premium  (Rs. ‘crores’) 33.13 21
Net Claim (Rs. ‘crores’) 10.11 13.01
Total Outstanding Claim (Rs. ‘crores’) 39.78 185.98
Net Profit  (Rs. ‘crores’) 7.53 5.78
Earnings Per Share (Rs.) 22.81 21.53
Networth Per Share (Rs.) 202.3 172.12
Market Price (Rs.) [Ashwin 30, 2076] 360 496
P/E Ratio 15.78 23.04


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