News

Pioneer Insurance profit rises 25% despite 19% drop in premium income
21 Apr 2026
Source: The Business Standard

Pioneer Insurance PLC posted a 25% year-on-year growth in net profit in the first quarter of 2026, driven largely by a sharp cut in management expenses, even as its premium income declined significantly.

According to the company's financial statements for the January–March period, net profit after tax rose to Tk16.59 crore, up from the same period last year. Earnings per share (EPS) also increased to Tk1.70, compared to Tk1.36 a year earlier.

However, the insurer's premium income dropped by 19% to Tk77.72 crore during the quarter, reflecting a broader slowdown in the general insurance sector.

The profit growth was mainly supported by a 45% reduction in management expenses, which fell to Tk16.37 crore. The decline followed a regulatory move by the Insurance Development and Regulatory Authority (IDRA) to cancel agent commissions for non-life insurers, easing operational costs.

Despite the improved bottom line, the company faced rising claims, which surged by 64% year-on-year to Tk12.11 crore during the quarter.

Commenting on the performance, Syed Shahriyar Ahsan, chief executive officer of Pioneer Insurance, said the industry is currently navigating a challenging environment.

"The cancellation of agent commissions has significantly reduced business volumes that were previously driven by agents," he told The Business Standard.

He added that a slowdown in private sector exports and imports, coupled with geopolitical tensions in the Middle East, has further impacted the sector.

According to Ahsan, the general insurance industry experienced a combined premium income decline of Tk221 crore in the first two months of 2026, reflecting sluggish economic activity and the absence of agent incentives.

He also raised concerns over pricing practices among smaller insurers, alleging that some companies are undercutting premiums to secure business. "This creates an uneven playing field for companies that maintain standard pricing and transparency," he said, urging regulators to address the issue.

To stabilise the sector, he suggested reintroducing mandatory motor insurance, citing rising road accidents and the need to expand coverage while improving industry transparency.

Despite the quarterly profit growth, investor sentiment remained cautious. Pioneer Insurance shares declined by 1.13% to close at Tk61.30 on the Dhaka Stock Exchange on Monday.

For the year ended 31 December 2025, the company reported an EPS of Tk4.57 and a net asset value per share of Tk46.97. Based on this performance, its board has recommended a 25% cash dividend alongside a 5% stock dividend, subject to regulatory approval.

The company's annual general meeting is scheduled to be held on 4 May through a digital platform.

 
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