Santam, South Africa’s largest short-term insurer, delivered a strong first-half performance, exceeding its long-term targets for all key performance indicators for the 2025 financial year.
The group reported net income of R2.045 billion for the six months to the end of June, marking a 19% increase from R1.718bn in the comparable period of 2024. This rise was supported by a 23% increase in earnings from conventional insurance to R2.526bn and a 28% rise in profit before tax from alternative risk transfer (ART) businesses.
The net insurance result from conventional insurance grew by 84% to R2.491bn, driven by an underwriting result of R2.025bn and an investment return on insurance funds of R466m.
However, the investment return on capital fell by 95% to R35m, primarily because of foreign currency translation losses from a strengthening rand, compared to gains in the prior period.
Associated companies contributed R59m, up by 51%.
Headline earnings per share increased to 1 873 cents from 1 578 cents, and earnings per share rose to 1 873 cents from 1 567 cents.
The board approved an interim dividend of 590 cents per ordinary share, representing a 10.3% increase from the interim dividend of 535 cents declared for the 2024 financial year.
Strong growth in gross written premium
Gross written premium (GWP) increased by 10% to R20.944bn from R19.084bn in June 2024, exceeding the long-term target of CPI plus GDP plus 1% to 2% (5.2% to 6.2% for the first half of 2025).
In South Africa, which accounted for 80% of GWP, premiums rose by 6% to R16.6bn from R15.7bn. Premiums from business outside South Africa grew by 25% to R4.2bn from R3.4bn, supported by the partnership with SanlamAllianz in specialist business across the African continent.
Santam said growth prospects were dampened by lacklustre economic growth, no meaningful change in employment levels, and pressure on personal disposable income following elevated inflation and interest rates.
Consumer financial health began to improve with easing inflation and monetary policy, although with delayed impact on spending.
MiWay achieved 14% growth in GWP, benefiting from inbound and tied agency strategies launched in 2023, the MiCashback value proposition in 2025, and improved persistency, with new business sales at record levels and the policy count up by 14 400.
Santam’s net earned premium (NEP) grew by 16% to R17.92bn from R15.395bn in June 2024. This exceeded the long-term target by a considerable margin. Conventional insurance NEP growth was 16%, compared with 7% in June 2024.
Underwriting result and margin
The underwriting result for conventional insurance was R2.025bn, yielding a net underwriting margin of 11.3% of NEP, compared with R993m and 6.5% in June 2024, surpassing the 5% to 10% target range.
Claims incurred came to R10.029bn (56% of NEP), compared to R9.595bn (62.3% of NEP).
Santam said the margin improvement stemmed from underwriting actions over the past two years at Broker Solutions, Client Solutions, and Santam Re, which significantly improved the risk profile and rating strength of the group’s in-force book. A benign attritional loss experience and the absence of significant catastrophe or large losses (compared with R705m in weather-related and other large losses in 2024) also contributed.
“The prevailing favourable claims environment is not sustainable, given the increase in the frequency and severity of extreme weather events over the past few years. Other large losses, in particular fire, are also expected from time to time. However, the roll-out of geocoding, improved risk assessment, segmented rate increases, increased surveying, and other management actions strengthened the group’s resilience, which should enable us to operate within the target range when conditions normalise,” Santam said.
ART businesses
The ART businesses grew profit before tax by 28% to R417m from R326m, representing 25% growth in operating earnings to R390m.
Operating earnings were supported by growth across revenue lines: fee income was up by 22% to R270m, driven by increased business under administration and one-off initial fees from new deals; the investment margin up by 30% to R222m because of favourable investment market performance; and underwriting profit of R92m from discretionary participation in cell reinsurance, compared with R100m in 2024.
India/Malaysia general insurance businesses
Santam’s share of GWP from Shriram General Insurance (SGI) in India and Pacific & Orient Insurance in Malaysia increased by 15%, with SGI as the primary contributor through growth in all distribution channels.
The net insurance result rose by 18%, with SGI’s underwriting performance benefiting from book growth, offset by lower underwriting profits at P&O.
Avatar investment
Santam acquired a 51% stake in Avatar Holdings Limited, based in the United Kingdom, during July 2025 for £3m, funded from available cash resources.
Avatar is a start-up with a technology platform for underwriting and pricing mid-sized corporate risks more efficiently than traditional methods.
“The mid-sized corporate market in the United States presents a significant growth opportunity for Avatar given its superior underwriting capability. The group will initially not deploy any underwriting capacity to Avatar. Depending on a successful track record being established, Avatar can become a source of future new business for the Santam Syndicate,” the group said.
In July 2025, Santam announced it had received in-principle approval from Lloyd’s to launch a UK-based syndicate named Santam Syndicate 1918. This syndicate symbolises Santam’s founding year and is intended to accelerate the group’s international growth and diversification objectives as part of its FutureFit 2030 strategy.
The syndicate will be based in London and aims to start underwriting later this year, with business incepting from 1 January 2026. Planned GWP for 2026 is anticipated to be in the range of £300m to £400m.
Outlook
Santam expects economic growth conditions to remain susceptible to global geopolitical developments and does not anticipate this to improve markedly for the rest of the 2025 financial year.
However, the group foresees an easing of pressure on personal disposable incomes and will, for the remainder of 2025 and into the 2026 financial period, focus on entrenching its leadership position in the intermediated insurance business area.
There will also be an increased focus on the higher growth areas in the direct distribution space, driving growth in new segments through partnerships, as well as driving the group’s international expansion strategy.
