Magazine date:
Dec 2003 
Insurance market features
- Regulatory authority: Financial Services Board (FSB)
- Earned premiums (2001): 20.297 billion USD
- Insurance density: 464.5 USD
- Insurance penetration ratio: 18%
Market structure in 2001
- Number of insurance companies: 155 (Life : 67 / Non life : 88)
- Number of reinsurance companies: 13 (Life : 6 / Non life : 7)
- Life insurance: The eight main insurers, at their head Old Mutual and Santam, have received 80% of their 2001 total premiums.
- Non-life insurance: Santam and Mutual & Federal alone represent about 40% of the net premiums of the market. 86 other companies share the 60% left.
- Reinsurance: In 2001, 7 damage reinsurance and 6 life reinsurance companies were registered in South Africa with total assets of about 1.3 billion USD. Reinsurers' total gross premiums in 2001 amounted to 0.8 billion USD, that is, 0.3 billion USD for life insurance and 0.5 billion USD for IARD insurance.
The market is dominated by branches of international groups, such as Hanover Re, Swiss Re, Munich Re, General Cologne and Gerling Global.
Identity
- Area: 1 222 000 Km²
- Population (2001): 43 700 000 inhabitants
- GDP (2001): 114.2 billion USD
- GDP per capita (2001): 2 613 USD
- GDP growth ratio (2001): 2.6%
- Inflation rate (2001): 5.8%
- Main economic sectors: Mining, chemicals, steelworks, textile, food products
Main cities
(in millions of inhabitant)
- Le Cap: 2.4
- Johannesburg: 1.9
- Durban: 1.1
- Pretoria: 1.1
- Port Elizabeth: 0.9
Regulation
The market is regulated by two texts of Law published in 1998- The Long Term Insurance Act for Life Insurance
- The Short Term Insurance Act for Damage Insurance.
The new provisions
- Several amendments to the Long Term Insurance Act were approved, following the application of the new regulation on commission fees on February 15, 2002.
- The Insurance Amendment Bill (2002) was approved by the government and published in the South African Official Journal in August 2002. The main amendment concerns life insurance and describes the method for companies to calculate insurers' assets and liabilities in order to guarantee their financial transparency.
Life premiums' breakdown by class of business
Net premiums
in millions ZAR
|  [4] |
Non-life premiums' breakdown by class of business
Net premiums
in millions ZAR
|  [5] |
South Africa's position in the world insurance market in 2001
in millions ZAR| Net premiums | Local market share | International market share | Position in Africa | Worldwide position | |
|---|---|---|---|---|---|
Life | 144 466 | 89.3% | 1.19% | 1st | 13th |
Non life | 17 313 | 10.7% | 0.32% | 1st | 27th |
Total | 161 779 | 100% | 0.84% | 1st | 16th |
Insurance market results
Life
in millions ZAR| 1998 | 1999 | 2000 | 2001 | |
|---|---|---|---|---|
| Income | ||||
Net premiums | 114 517 | 115 539 | 147 747 | 144 466 |
Investment income | 36 010 | 31 963 | 36 506 | 34 940 |
Other income | 2 874 | 2 049 | 7 714 | 11532 |
Total | 153 401 | 149 551 | 191 967 | 190 938 |
| Expenditure | ||||
Benefits | 92 470 | 104 787 | 118 233 | 123 194 |
Management expenses | 9 504 | 8 521 | 9 006 | 9 364 |
Commissions | 5 621 | 5 358 | 6 061 | 5 653 |
Other expenditure | 830 | 240 | 7 375 | 1 779 |
Total | 108 425 | 118 906 | 140 675 | 139 990 |
Non-life
in millions ZAR| 19981 | 19992 | 20003 | 2001 | |
|---|---|---|---|---|
| Income | ||||
Gross premiums | 22 697 | 21 250 | 24 670 | 26 538 |
Net premiums | 17 116 | 16 205 | 16 345 | 17 313 |
Investment income | 2 555 | 4 631 | 4 859 | 3 692 |
Total | 19 671 | 20 836 | 21 204 | 21 005 |
| Expenditure | ||||
Claims paid | 11 975 | 10 889 | 11 812 | 11 593 |
Management expenses | 2 657 | 2 314 | 3 002 | 3 683 |
Commissions | 2 132 | 1 798 | 1 636 | 1 641 |
Total | 16 764 | 15 001 | 16 450 | 16 917 |
Total net premiums
in millions ZAR