Financial services group Momentum Metropolitan Holdings will not force its staff to vaccinate and its South African life insurance business paid a record R10.7 billion in mortality claims during the year ended June 2021. Photographer: Ayanda Ndamane AFrican News Agency (ANA)
Financial services group Momentum Metropolitan Holdings will not force its staff to vaccinate and its South African life insurance business paid a record R10.7 billion in mortality claims during the year ended June 2021. Photographer: Ayanda Ndamane AFrican News Agency (ANA)

No mandatory vaccines for staff, says Momentum Metropolitan CEO

By Dineo Faku Time of article published Sep 9, 2021

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FINANCIAL services group Momentum Metropolitan Holdings will not force its staff to vaccinate and its South African life insurance business paid a record R10.7 billion in mortality claims during the year ended June 2021.

Speaking at a virtual financial results presentation yesterday, chief executive Hillie Meyer said the group would rather convince anti-vaxxers to vaccinate rather than enforce a mandatory vaccination policy.

He said the group’s management fully supported the vaccination drive for employees, clients and the company.

“I think it is the best weapon against the impact of Covid-19 but I would much rather sit with every one of the anti-vaxxers of our business one on one and try to convince them to vaccinate. Ultimately, it will be your choice,” he said.

Meyer’s comments come as his counterpart, Discovery chief executive Adrian Gore, announced plans to introduce a compulsory vaccination policy for the group’s South African-based employees from January 1, 2022. Gore also told staff the group would make its buildings a vaccination-only zone.

Momentum Metropolitan said its South African life insurance businesses paid R10.7bn in mortality claims compared to an average of R5.6bn a year over the three years preceding the pandemic.

The group said the impact of the second and third waves of the pandemic could be seen in the gross mortality claims over the second half of the year being 55 percent higher than the mortality claims in the first half of the year, which were already elevated because of the first wave.

On a consolidated basis, the group’s South African life insurance businesses experienced aggregate mortality losses of R2.823bn in 2021, said the company. Group operating profit declined by 93 percent to R73 million during the financial year, largely due to the increase in the additional Covid-19 provision of R2.239bn net of tax, of which R2.128bn related to mortality. Momentum Metropolitan’s normalised headline earnings were down 34 percent to R1bn for the 12 months.

“The increase in the Covid-19 provision mainly reflects the expected impacts from the third and possible fourth wave of the pandemic that is expected to emerge in the next year to June 30, 2022,” said the group.

Momentum Life’s normalised headline earnings declined from a profit of R578m in the prior year to a loss of R859m, which was mainly attributable to an operating loss of R991m.

Meyer said that given the group’ strong presence in life insurance, Covid-19 had a severe impact on its financial results.

“However, despite the disruption that Covid-19 brought about, we are pleased that our group performed very well operationally.

“A highlight was the excellent new business performance in our retail businesses, where Metropolitan Life and Momentum Investments experienced record years, while Momentum Life and our Africa businesses saw good new business volume growth,” said the group.

One of the company’s highlights was Guardrisk’s normalised headline earnings improving by 13 percent to R377m supported by strong growth in underwriting profits, despite an increase in the Covid-19-related business interruption provision in the first quarter of the 2021 financial year.

The group said Guardrisk Insurance settled more than 80 percent of the eligible business interruption claims, predominantly in the hospitality sector. As at the end of June 2021, Guardrisk finalised 516 claims with payments amounting to R409m.

A final dividend of 15 cents a share was declared bringing the total dividend for 2021 to 40c, flat on the prior year.

Momentum Metropolitan Holdings shares closed 2.63 percent higher at R19.50 on the JSE yesterday.

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