SUNU Assurances Nigeria Plc is expecting only marginal growth in its core insurance business in 2026, even as the company projects a stronger cash position and plans for an equity capital increase that could provide a significant boost to its financial position.
In its 2026 earnings forecast filed with the Nigerian Exchange Limited (NGX) on Thursday, the insurer projected gross premium written of N17.07 billion, just 0.36% above the N17 billion recorded in 2025.
The company also expects to raise its premium generation by 15.78% from the N14.74 billion it had projected for the nine months to September 2026.
For shareholders, the numbers suggest that SUNU is not banking on rapid expansion in premium income to drive its 2026 performance. Instead, the forecast points to a combination of insurance service earnings, investment income and a significant injection of fresh equity capital.
The company expects insurance revenue of N16.19 billion for the year, with an insurance service result of N4.11 billion after insurance service expenses of N8.77 billion and net expenses from reinsurance contracts of N3.31 billion.
Investment returns are also expected to play a sizeable role. SUNU has forecast N1.89 billion in investment income and N168.05 million in net fair value gains on financial assets.
After operating expenses of N4.51 billion and other projected costs, the company expects to make N1.50 billion before tax and N1.24 billion after tax in 2026.
The capital injection
Perhaps the most significant figure in the forecast for investors is not the projected profit, but the N9.33 billion equity capital increase included in the company’s cash flow projections.
SUNU expects financing activities to generate N9.33 billion from the equity capital increase, while no dividend payment has been provided for in the 2026 forecast.
If achieved as projected, the capital injection would provide the company with additional funds to support its operations and investments.
For existing shareholders, however, an equity raise also raises an important question about the eventual impact on their ownership and earnings per share, depending on the structure and terms of the capital increase.
In the forecast, the SUNU does not provide details in the document on the structure, pricing or terms of the proposed equity capital increase, so those implications cannot yet be quantified from the forecast alone.
Cash position to more than double
SUNU is forecasting a substantial improvement in its liquidity position.
According to the figures, cash and cash equivalents are projected to increase from N11.41 billion at the beginning of 2026 to N27.69 billion at year-end, representing an increase of about N16.28 billion.
Most of the projected closing balance is expected to be held in short-term placements, which are forecast at N27.29 billion, compared with N394.01 million in cash and bank balances.
The interesting part is that the stronger cash position is not expected to come from the insurance business alone. SUNU is projecting negative N806.47 million in net operating cash flow, while investing activities are expected to provide N7.75 billion and financing activities another N9.33 billion.
That makes the projected capital raise an important part of the company’s 2026 financial outlook.
What shareholders should know
The forecast presents a company expecting to make money in 2026, although the underlying picture is more nuanced than the N1.24 billion profit figure suggests.
Premium growth is almost flat, indicating a relatively modest expansion of the insurance business.
Investment income is expected to contribute meaningfully to earnings, while the company is simultaneously projecting a major improvement in liquidity through investment redemptions and a N9.33 billion equity capital increase.
For shareholders, the key issues to watch through the year will therefore be whether premium growth accelerates, whether investment income meets expectations, how the proposed equity injection is structured and whether the stronger cash position ultimately translates into stronger business growth and shareholder returns.