Sanlam Group hails insurance penetration in Ghana
One of the largest financial services groups in South Africa, Sanlam Group has lauded the rate at which life insurance is patronized in Ghana.
According to the group, despite the low penetration rate of just about 2%, Ghana is the most-outstanding market after South Africa - compared to the other 11 key markets in its sub-Saharan Africa operations.
Sanlam which has been in existence since 1918 has evolved from a traditional insurer to a diversified financial service provider with both local and international footprints.
In Ghana, Sanlam is partnering Enterprise Group. It acquired a 49 percent stake in leading Life Insurance Company, Enterprise Life in 2006. According to the Corporate Development Executive for emerging markets, Thabied Majal, apart from South Africa, their Ghana operations has so far proven to be the most successful across the African markets they have presence in.
“When I say Ghana is our most successful business, I mean mainly in terms of life business and we use the term called the Value of New Business which is simply, the present value of the premiums and it gives you a sense of our profits going forward. And if I look at all the countries we're operating in Ghana is the biggest driver of Value of New Business for Sanlam. So its not about profitability in the short term but in the long term because we're going to be here in the next 50 years plus. So the value of new business is what we use as the key metric to measure the success and potential of the business going forward” he said.
He continued “Insurance in Sub-saharan Africa is under-developed and that obviously is the opportunity for us. So if we look at where we are and what we have achieved, the business in Ghana has been particularly successful in terms of number of lives insured compared to other markets where we entered at the same time. So for example in a market like Tanzania, it taken a whole lot longer to get insurance there and the same with Uganda where we entered about 3 years after Ghana and still taken a lot longer to grow life insurance.
If you look at the average life-insurance penetration for the world is about 4% even though places like South Africa and US have double digits. So in Ghana, we understand it's a slow growth but all we see is the opportunity as long as we can first get people to buy into the concept of life insurance and develop the market. We're not in a hurry to want to change the market overnight”.
Mr. Majal was speaking to JOY-BUSINESS during the sod-cutting ceremony for a Gh¢ 485,000 Social Centre the group and Enterprise Life are building for the SOS Village in Kumasi as part of their Corporate Social Responsibility. The Chief Executive of Enterprise Life, C.C Bruce on his part also said they are stepping up efforts to harness technology to boost insurance penetration in the country.
“With our business where we deal with volumes of data, that's a strong retail business with a number of policy-holders and all of them pay premium every month, you can see that there's a lot of data to be processed and the operating software makes a huge difference in the company's operations. And our operating software has been good. But last year we refreshed it and added additional features which we hope would give us advantage on the market. Now we would have multiple touch points with our policy holders and we're hoping that in the next couple of months we will officially launch this for our policyholders can get to us face to face, through our call centre and with self-service among others” he noted.