The financial pressure of the last year has seen its fair share of casualties.
There has hardly been a week without news of a company’s share price tanking or even shutting its doors. The regulatory response to the international financial crisis has also made business particularly challenging for those in the financial services industry.
Yet despite this gloomy business environment, the South African insurance industry took some time out to acknowledge companies who have continued to deliver great products.
South African intermediaries gave recognition to the top insurance companies at an awards ceremony that was held on 3 June 2010 at Emperors Palace in Johannesburg.
Organised by the Financial Intermediaries Association of Southern Africa (FIA), the awards pay tribute to those insurance product providers who receive favourable ratings in the FIA’s annual intermediary satisfaction benchmark survey conducted by Bluestream Research. Introduced in 1998, many consider the awards a highlight on the financial services industry calendar.
FIA represents more than 15 000 financial services advisers throughout Southern Africa. It holds that its primary purpose is to represent, protect, promote and further the common interests of its members.
The origins of the FIA date back more than 50 years, with the organisation recently evolving into a single, united national body representing the bulk of active licensed intermediaries in South Africa’s financial services industry. Through FIA, intermediaries gain insight into the everchanging regulatory environment and access to information on how they can reach compliance.
According to Pieter Aucamp from Bluestream Research, the results over the past five years have had a positive influence on competitive behaviour in the insurance industry.
‘The fact that over 6000 insurance contracts were rated this year, makes it one of the most comprehensive exercises on the benchmarking of intermediary satisfaction in the insurance industry. The stability and validity of the measurement have been practically proven over this time,” he comments.
The survey rated 6146 insurance broker contracts with Bluestream making over 22 000 telephone calls. FIA members rate their product providers with regards to the perceptions, views, expectations, awareness levels and opinion on product quality, service quality, relationship quality and overall satisfaction with their supporters.
The awards this year were divided into nine categories each with an overall winner:
Personal lines, Commercial and Corporate — Santam
For the second year in a row, Santam was voted South Africa’s leading short-term insurer by independent brokers in all three categories for short-term insurance, Personal, Commercial and Corporate Insurance.
‘We are both humbled and inspired to be chosen as the leading short-term insurance company by South Africa’s independent brokers – who are the cornerstone of our business,’ says Ian Kirk, Chief Executive of Santam.
‘The annual FIA Awards present Santam with a very important yardstick to determine if the business has correctly applied itself to the demands of the local market.
‘We have retained our position as industry leader in the midst of the worst recession the country has faced over many years and have emerged from a third year of difficult underwriting conditions in robust shape. This is due to our diversified business, our faith in the intermediated business model and managing the business tightly in tough times,” Kirk comments.
Life / Risk — Discovery
Discovery Life took this award for the third consecutive year. ‘As always, we dedicate this achievement to the financial advisers who help consumers navigate the financial services industry, equipping them to make the right decisions for their individual needs,” comments Herschel Mayers Discovery Life CEO.
Discovery Life’s Cover Integrator, introduced recently affords people additional risk cover at half the price of their standard cover. ‘This is significant given the fact that most South Africans are woefully under-insured. Across its businesses, Discovery has also focused on efficiency and financial prudence, ensuring ongoing financial strength and sustainability.”
Investment products recurring premium and single premium Taking the award for the first time in five years, Sanlam points to its improved communications as its key differentiator.
‘Sanlam’s research has shown that although product flexibility and choice of underlying investment funds are important in the advice process, independent advisers increasingly regard sound costing structures, reliable service and ongoing quality communication as key to having a competitive edge. It is obvious that Sanlam is excelling at this and our endeavours to keep both clients and independent advisers abreast of their investments have paid off.”
Kobus Vlok, chief executive of Sanlam Personal Finance (SPF) distribution Hennie de Villiers, CEO of Sanlam Topaz, the business unit that scooped the award believes the company’s efforts in demystifying the language of the investments went a long way to ensuring the company’s success.
‘We have been working hard over the past three years to make our investments accessible to the average investor. This is our most powerful tool for both the intermediary and the consumer,” he comments.
Medical Aid — Discovery
This award was the second hat-trick for Discovery Health and the company attributes its success to increased flexibility and innovation. ‘The Delta options give members the choice to pay significantly lower contributions if they opt to use our proprietary hospital network. The approach has stood Discovery in good stead, with continued strong new business growth and growing support among clients and financial advisers,” explains Neville Koopowitz Discovery Health CEO.
Underwriting Manager — CIA (Commercial and Industrial Acceptances), acting on behalf of Compass Insurance
This is the first year for this category and CIA, a building insurance specialist, takes its place as the inaugural winner. ‘While it has been a particularly tough trading year for the insurance industry in general, we are fortunate in the building insurance sector that buildings are invariably one of a client’s biggest assets. They can’t afford not to have those assets insured so we have escaped the worst effects of the recession,” explains André de Waal, MD of CIA
‘In fact, we have continued to grow during the downturn as people have chosen to cut-back in other areas, preferring to ensure that their buildings are fully protected, so they don’t lose a valuable asset in the unfortunate event, for instance, of a fire.”
‘There are many intricacies in the insurance of buildings — it’s not just a question of a standard ‘one-size-fits-all’ policy and it’s essential that policies are tailored to suit the property owning entity in order to provide the correct cover. Underwriting managers provide technical knowledge and one of their main functions is to provide a level of service that is even higher than that provided by traditional insurers. In this manner, both brokers and clients get the best technical advice and service.”
Employee Benefits — Momentum
The Momentum Group, won the best Employee Benefits Product Supplier of the Year 2010 Award for their FundsAtWork product. Momentum’s FundsAtWork umbrella fund provides retirement, insurance, lifestyle and business benefits to small and mid-sized companies that cannot afford the administrative and cost burden of running their own retirement funds.
Commenting on the much touted social security reforms which have been under discussion for the past three years, Carol Atkinson, Head of Product Development and Marketing for Momentum FundsAtWork says: ‘Umbrella funds will continue to play a very important role in the employee benefits arena and we believe that more South Africans should have the opportunity to contribute towards their own retirement.
Momentum is therefore fully supportive of the social security and healthcare reforms and is contributing to the process by engaging with policymakers, regulators, organised labour and other stakeholders, through the various industry associations,” The FundsAtWork product was launched as part of Momentum’s employee benefits offering in the umbrella funds space in 2000. It now has close to R9 billion of assets under management for over 135 000 members. Bluestream Research now has five years of data based on the same methodology, giving the industry an ability to make genuine comparisons on performance.
‘These awards add value to the industry by providing benchmark best practice statistics for intermediary satisfaction. Participating in the survey provides a platform for intermediaries to rank their interactions with insurance companies and in so doing, encourage healthy competition amongst providers,” concludes Seamus Casserly, President of the FIA.