Axa Mansard Insurance delivered robust performance in Q1 2026

Axa Mansard Insurance Plc (Axa) delivered a robust underwriting performance in Q1 2026, underscoring the strength of its core insurance operations. Insurance revenue grew 20.1% year-on-year to N48.5 billion, while the insurance service result rose even more strongly by 53.6% y/y to N6.5 billion.

This outperformance was driven by a notable improvement in the loss ratio, which declined by 729 basis points to 49.2% from 56.5% in Q1 2025—reflecting better claims numbers and stronger underwriting discipline. On a sequential basis, performance was even more compelling, with the service result surging 177.1% from N2.3 billion in Q4 2025, highlighting a sharp rebound in operational efficiency.

Despite this solid underwriting backdrop, profitability was weighed down by a weak investment performance. Profit before tax declined 41.9% y/y to N3.6 billion, driven almost entirely by a collapse in investment returns, which fell 85.6% from N5.8 billion in Q1 2025 to N841 million. This was largely due to a N3.1 billion foreign exchange loss recorded under other investment income, which dragged total investment income into negative territory at -N2.4 billion. Stripping out this FX impact, the underlying earnings profile appears significantly stronger and more reflective of the Company’s improving core operations.
Cost management provided a positive offset during the quarter.

Marketing and administrative expenses declined 21.3% y/y, while employee benefit expenses fell 8.1% y/y. Sequentially, the cost improvement was even more pronounced, with administrative expenses dropping 73.6% and other expenses down 42.3% relative to Q4 2025. While part of this reflects seasonal normalization following a typically heavier fourth quarter, it also signals tighter cost discipline and improved operational efficiency.

However, reinsurance costs remain an area to watch. Reinsurance expenses increased by 35.3% y/y, outpacing premium growth of 20.1%. While this exerts some pressure on net insurance margins, it also indicates a more conservative risk posture, with greater risk transfer to reinsurers helping to protect the balance sheet against potential large claims. This higher risk transfer to reinsurers trend needs to be watched because if it continues, it could weigh on margins over the medium term.

On the balance sheet, the Company showed robust expansion. Total assets grew 14.3% to N260.6 billion, supported by a 56.9% increase in reinsurance contract assets to N45.3 billion. Insurance contract liabilities also rose sharply by 53.1% to N132.2 billion, suggesting strong new business generation during the period. Shareholders’ equity increased by 8.4% to N56.7 billion.

However, return on average equity declined by 564 basis points to 6.24%, primarily reflecting the drag from weaker investment income.

Looking ahead, foreign exchange exposure remains the key swing factor for earnings. The N3.1 billion FX loss materially distorted profitability in Q1, and continued Naira stabilisation or improved currency risk management could drive a meaningful recovery in investment income.

Overall, the core insurance business is demonstrating clear strength, with improving underwriting quality and cost efficiency. The key question for subsequent quarters is whether the investment portfolio can recover and align with the strong operationalmomentum, thereby unlocking full earnings potential.