JOHANNESBURG - South Africa’s largest short-term insurer Santam said it has paid more than R800 million in agri related claims in 2019 as a result of catastrophes reported during the year in the country.
Chief executive Lizé Lambrechts said fires, floods and drought devastated various parts of the country during 2019, with Gauteng, KwaZulu-Natal and the Northern Cape taking a particular toll. “We have seen time and again the impact disasters have on the country’s most vulnerable communities. Therefore, we are continuing to focus on entrenching resilience through sustainable partnerships,” Lambrechts said.
The group added that following a difficult start to 2019 - with a number of catastrophe events which had an impact of R334 million compared to R114m in 2018 and significant insurance crop losses - the business experienced a subdued claims environment for the remainder of the year, resulting in a strong underwriting performance.
In the year to end December, Santam reported a 7percent increase in gross written premium to R29.7 billion and 7.7percent underwriting margin despite the country’s low economic growth and year-on-year increase in catastrophes and crop damage.
Its basic earnings per share declined 9percent to 1990 cents a share, and headline earnings per share fell by 1percent to 2069c.
The group declared a final dividend of 718c from last year’s 665c.
Lambrechts said the group was satisfied with its performance during the period.
“Our underwriting margin is at the high-end of our target range of 4percent to 8percent. Going forward, the group will continue focusing on growth, disciplined underwriting actions and managing the risk associated with poor economic conditions,” Lambrechts said.
The group said weak economic conditions negatively in Namibia, however, impacted its growth.
The MiWay underwriting results were not significantly impacted by the catastrophe events during the period, resulting in an improved loss ratio of 54.2percent and an underwriting profit of R393m compared to last year’s profit of R334m.
The property class reported an underwriting result of R212m compared to the R519m reported in 2018, impacted by catastrophe events in South Africa and in Asia.
The Alternative Risk Transfer business reported excellent operating results of R171m compared to R96m reported last year.
Santam shares declined 0.01percent on the JSE yesterday to close at R266.30.