Ethiopian Reinsurance (Ethio-Re), the first reinsurance company in Ethiopia, has increased its profit before tax by 45.3% to ETB616.7m ($3.98m) on the back of reinsurance revenue growth, for the financial year ended 30 June 2025 (FY2025).
The company’s financial results, published in its annual report released at the end of December 2025, also reflected higher premium retention and bigger investment income which offset rising claims.
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FY 2025
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FY2024
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Y-o-Y change
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Reinsurance revenue
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2,959.5
|
2,212.5
|
33.8
|
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Reinsurance service result
|
300.8
|
154.2
|
95.1
|
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Net investment income
|
406.2
|
317.8
|
27.8
|
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Net financial result
|
745.5
|
518.0
|
43.9
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Profit before tax
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616.7
|
424.4
|
45.3
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Tax
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65.0
|
33.0
|
97.0
|
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Net profit after tax
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551.7
|
391.4
|
41.0
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Balance sheet at 30 June
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2025
|
2024
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|
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Total assets
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5,216.7
|
4,706.3
|
10.8
|
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Total equity
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3,130.1
|
2,579.7
|
21.3
|
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Source: Ethio-Re Annual Report 2024-2025
The financial statements were prepared based on IFRS 17.
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In FY2025, the reinsurer’s accomplishments were moderated by a range of challenges, including:
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The shortage of foreign currency, rising inflation, and the lack of foreign currencies have negatively impacted the business
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Tax incentives for regional reinsurers are creating an uneven competitive environment
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Although a peace agreement is anticipated, the threat of wars and political instability within the country is obstructing economic progress and, as a result, the frequency and severity of claims occurrences
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The political landscape in the country has undergone significant transformation, marked by global and national conflicts and regional political instability. These factors have adversely affected economic conditions, hindered infrastructural development and negatively influenced the overall economy, thereby impacting the company’s ability to settle claims. The claims experience during the year has also adversely affected the company’s financial performance.
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There is a lack of quality and timely data and information. The limited application of information technology in the insurance sector has resulted in insufficient data, which in turn affects underwriting processes and the timely availability of information crucial for operational activities.
Some of these challenges have prompted Ethio-Re’s board and management to implement adjustments and enhancements to relevant policies and strategies, aiming to realign the company’s performance and mitigate the negative effects of these challenges.
Ethio-Re started operations on 1 July 2016 and is authorised to engage in both life and non-life business. The company conducts business in more than 10 countries in Africa. It generates 95.1% of its total business in Ethiopia. The remaining 4.9% is from different sub-Saharan African countries.