Reported by Midwest Holding Inc. a GAAP net income of $3.8 million for the first quarter of 2023, a significant improvement compared to the $0.2 million recorded in the previous quarter of the year.
GAAP total revenue in Q1 was $38.5 million compared to revenue of $2.6 million in the same period last year. The company said it was driven by an increase in investment income from the growth of invested assets retained, as well as higher policy administration fees, and increased amortization of deferred ceding commissions.
At the same time, investment income for the quarter increased to $19.2 million from $6.2 million from the prior year quarter.
Midwest also noted that amortization of deferred reinsurance profits came in at $1.6 million in Q1, compared to $1.0 million from the same period last year. The company explained that this is due to the increase in the deferred profit of co-insurance in the balance of $ 40.0 million compared to $ 38.1 million a year ago, which reflects the ceding commission received in reinsurance to third parties.
Meanwhile, annuity direct written premium under statutory accounting principles (SAP), a non-GAAP measure, increased 98.4% to $194.6 million in the first three months of the year from $98.1 million in Q122, due to the focus on distribution and pricing.
Additionally, midwest’s ceded premiums (SAP), a non-GAAP measure, was $102.1 million in Q123 compared to $40.1 million in Q122.
Georgette Nicholas, CEO of Midwest, commented on the company’s Q1 results: “We are excited about the execution and growth of the business. The results for the quarter reflect a continued focus on distribution, pricing, products, investment management, and reinsurance to position the Company for further growth.