Johannesburg - Absa - one of SA’s big four banks - says it will buy a controlling interest in Instant Life for an undisclosed amount.
The deal, subject to customary approvals, will give Absa a 75 percent stake in Instant Life, which is an online life insurance distribution platform offering life, disability and critical illness cover to qualifying customers.
It was established in 2008 to address a growing market for pure-risk life insurance sold online. Since inception, the business has had a steady performance with strong revenue growth.
Absa Life MD Jannie Venter notes, in a statement, that the deal will “provide Absa with a scalable platform to grow our bancassurance business as we will now be able to deliver automated and efficient life insurance through all our customer accessed distribution channels”.
He adds: “By leveraging Instant Life’s existing digital platform, customers will have access to a self-service function that will allow them to acquire insurance and easily update and manage their policies online.’
The statement notes the acquisition also complements Absa’s recent launch of what it claims is the first predictive underwriting solution in Africa, and one of the first globally.
“This innovation has received a number of industry accolades and awards this year and this transaction is a continuation of Absa’s journey to improve the customer experience,” says Absa.
Venter adds “Instant Life has developed a tele-underwriting methodology that caters for 99 percent of lives to be underwritten online or through a telephonic interview that is backed up by an interactive underwriting decision tree”.
Absa’s acquisition of Instant Life follows a deal that saw it take a controlling interest in First Assurance in Kenya in June.
Venter says, “Instant Life’s technologies provide an essential component to deliver online underwriting across Africa which is capable of operating in multiple jurisdictions across numerous currencies. This ties in well with Barclays Africa’s strategic objective to capture the growth opportunity in our Wealth, Investment Management and Insurance business by building on our existing presence in Africa.”
Venter also says the companies will immediately benefit from cross-selling opportunities.