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Willem Roos and Howard Aron
Joint chief executive officers, OUTsurance Holdings
  Willem Roos and Howard Aron  Willem Roos and Howard Aron

OUTsurance’s business model is built on a philosophy of scientific underwriting and pricing, innovative product design, a robust and efficient information technology platform and a high performance culture driven by great people. It believes in a client-centric strategy of providing value for money insurance products and awesome client service.

OUTsurance is committed to sustainable relationships with all its stakeholders. Examples of OUTsurance’s involvement in the community include the pointsmen project where 132 pointsmen help to alleviate traffic congestion at high-traffic intersections, and the staff helping South Africa OUT project where hundreds of OUTsurance employees volunteer their time and efforts in order to make a difference in the lives of less fortunate South Africans through various projects.

The OUTsurance group produced a satisfying financial performance for the year. The core South African personal lines business started off a prior year base of record and unsustainably low claims ratios. Such outcome was used to pass on below inflationary premium increases to its client base. OUTsurance’s South African direct life insurance business has gained significant traction during the year. Youi, the group’s direct personal lines initiative in Australia, achieved the necessary scale to run profitably and produced a profit for the second half of the financial year.

In the second and third quarters of the financial year, the group sustained the most severe weather related natural catastrophes in its history. Notwithstanding a well-structured, conservative re-insurance programme that absorbed the bulk of the losses, the group incurred a net loss from these storms of R108 million (2012: R21 million).

Despite these catastrophes, the SA business produced a solid operational performance. This, coupled with the scale achieved by Youi, gave rise to the following outcome:

  • normalised gross written premium increased by 23% to R8.3 billion. Of this 29% was written in Australia;
  • the claims ratio of 51.5% (2012: 47.5%) is still within the group’s target range and significantly below that of its peer group;
  • normalised earnings increased by 0.3% to R1.2 billion;
  • return on equity amounted to 38%; and • having accessed the cash earnings generated relative to its re-investment requirements, OUTsurance increased its dividend payout by 21%.

RMI Holdings included R990 million of OUTsurance’s earnings in its normalised earnings (2012: R1 010 million).

For an in-depth review of OUTsurance’s performance, RMI Holdings’ shareholders are referred to www.outsurance.co.za.