Sanlam is progressing with integrating life insurer Assupol, which it acquired for R6.6 billion in September last year, into the group.
Assupol’s executive team became part of Sanlam’s retail mass executive team earlier this year, the group said in its integrated financial report for 2024 released last week.
“The group has focused on preserving customer value and is confident that during 2025 the integration of the business and its people will be complete,” Sanlam noted.
Anton Gildenhuys, non-executive director at Assupol, highlighted the significant opportunity the merger presents.
“By merging Assupol with our existing retail mass operations, we have formed the leading mass player in South Africa. Our combined book is now the largest in the industry, which presents enormous scale advantages for us in Sanlam. We have more than 7 000 tied agents across South Africa, and we enjoy support from more than 1 000 independent financial advisers, again, leading positions in the market.”
Gildenhuys noted Assupol’s successful first three months as part of the new entity, with a focus on value protection.
“Any change brings uncertainty, and we’re very conscious of the need to retain our people, our advisers and, most importantly, our clients.”
He added that the group reduced inter-organisational policy replacements by 60%, with plans to reduce this further.
“Crucially, our manpower in both the Sanlam retail mass and Assupol distribution teams remains stable.”
He also highlighted the group’s improved persistency and new business growth, contributing to future profitability.
“The focus on value protection is already evident in the returns from the business,” Gildenhuys said. “Our initial outlay has been just below R6.6bn. Based on Sanlam’s valuation method, the GEV (group equity value) on the Assupol business is still R6.6bn at the end of 2024.”
Sanlam received a dividend of R781 million after the acquisition, achieving a 12% return over the first three months.
Assupol’s contribution to end-result earnings for the first three months was R218m.
Looking forward, Gildenhuys underscored value creation.
“We have identified significant low-hanging synergies from business harmonisation and integration. This includes IT consolidation and optimising procurement activities, resulting in cost savings, profit growth, and increased market share of new business.”
The company plans to unlock additional potential through productivity improvements in Assupol’s channels.
“This will happen by rolling out the digital tools we’ve developed over a number of years at Sanlam, which have driven substantial productivity growth.”
Product diversification and cross-selling are also key growth drivers.
“We have broadened the solution set in retail mass with pilot activities in 2024, with a roll-out planned for 2025. These solutions include wills and estate products, credit solutions, primary healthcare, general insurance, and transactional services.”
Another focus for 2025 is expanding and repositioning the branch network. Although Assupol already operates more than 80 branches, these were mainly for servicing existing clients.
“While the servicing of clients will continue, we will now also focus these branches on driving new business for the broader solution set,” Gildenhuys said.
The goal is to expand to 200 strategically placed branches across the country.
“By offering a broad solution set, backed by this physical presence, we believe we will improve our ability to forge stronger relationships with our clients and a much larger client base, resulting in improved retention and growth.”
