Santam, SA’s largest short-term insurer, is ramping up its international growth blueprint, with the group set to spend a sizeable amount to scale up its UK expansion.
The group, worth R50bn last month, entered into an agreement with Lloyd’s to launch a syndicate based in London, targeting more than £300m in initial gross written premiums. Through Lloyd’s licences, the syndicate will enable Santam to trade in about 77 insurance and 200 reinsurance territories across the world.
The syndicate is set to come online from January 1 2026. Santam CFO Wikus Olivier said the group will back its international initiative.
“Our target is between 145% to 165% solvency ratio. Even after the interim dividend we have declared, we will still be sitting around the top end of that target range,” Olivier said.
“From a capital allocation perspective, the bulk of the excess cash is earmarked to support the Lloyd’s initiative. We are planning to grow strongly through Lloyd’s and that will require us allocating capital in support of that business.”
Santam is looking to use Lloyd’s as a platform for international expansion by unlocking its global licences and excellent financial strength.
Santam CEO Tavaziva Madzinga said the international play is the central part of the group’s strategy.
“We currently write 20% of our premiums outside SA. It is our expectation is that the international playbook continues to be a dominant part of the strategy as a way for us diversifying our business,” Madzinga said. “We will remain a dominantly SA player. But we do find that our international business allows us to diversify by class and geography.”
Santam on Monday reported higher earnings at the halfway stage, with solid contributions from personal and commercial lines within its conventional insurance business.
The group said all businesses exceeded their 2024 performance. Group insurance revenue was up 12% at R27.5bn for the six months to end-June, while headline earnings per share (HEPS) were 19% higher at R18.73.
An interim dividend of 590c per share was declared.
SA remains the most significant contributor to gross written premiums at 80%, with business from this market increasing 6% to R16.6bn.
The group reported conventional insurance net earned premium (NEP) growth of 16% to R17.9bn and a net underwriting margin of 11.3%, compared with 6.5% a year ago.
The positive earnings momentum was augmented by benign attritional losses and an absence of weather-related catastrophes, Santam said.
The Alternative Risk Transfer business grew its profit contribution by 28%. This is the result of improved operating earnings, supported by growth across most of the main income lines, as well as an increase in investment return earned on capital.
The net insurance result from participation in Sanlam’s Indian and Malaysian businesses increased by 18%. Shriram General Insurance (India) was the primary contributor, with solid growth from all distribution channels.
The group also reported a turnaround in the property portfolio’s performance and an improvement in Santam Re results, while MiWay recorded a double-digit underwriting margin despite investments in strategic initiatives.
Santam expects economic growth conditions to remain susceptible to global geopolitical developments and are not expected to improve markedly in the second half of 2025.
“Easing pressure on personal disposable income and our strategic focus on higher-growth areas in the direct, partnership and international space should support growth prospects in the remainder of 2025 and into 2026,” it said.
Update: September 1 2025
This story has new information.
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