SOLUTIONS ALIGNED TO SOCIAL & ENVIRONMENTAL NEEDS
As per the FSC, Santam is committed to addressing the historical lack of access to short-term insurance services by previously disadvantaged people in South Africa. This challenge is also an opportunity for us, because of the existence of a new and largely untapped market of first-time insurance sector clients.
Santam is entering the entry-level market by creating partnerships with various retail channels. Our New and External Markets unit has developed a portfolio of distribution partners who will act as Santam’s intermediary distribution channel to the ELM. This not only expands Santam’s reach but also enhances the sustainability of being an intermediated brand and presents cross-selling opportunities using premium brands in our personal lines market.
During 2009 we concluded partnerships with McCarthy Motors and the JD Group. These are viewed as new channels for selling products in our personal lines business segment, with a sound opportunity to access entry-level markets.
- McCarthy Motors partnership: As South Africa’s leading motor retailer, 70% of McCarthy’s clients are private buyers, and the entry-level market represents the greatest growth opportunity for insurance products. Santam will operate through the financial and insurance consultants available at each McCarthy’s dealership.
- JD Group partnership: The entry-level market accounts for over 70% of the JD group’s customer base, and this partnership will serve as a platform to educate them about short-term insurance and Santam. Santam will provide JD Group customers with highly competitive premiums, comprehensive products and great service.
In 2006 Santam launched the Multi-Home product to a growing client base in Soweto, placing us among the first insurers to offer household policies to the entry-level market. Since then we have continued to expand the product’s footprint nationally, and have received high acceptance and a keen interest from this market segment.
Product accessibility has been extended – in addition to distribution through personal contact, clients can now make cash payments through Shoprite Checkers stores countrywide. Furthermore, we now offer alternative modes of payment to suit clients who prefer not to pay cash premiums.
We are continuously evolving our strategies to ensure a cost-effective distribution infrastructure by collaborating with various affinity groups. In 2009 the Zionist Christian Church was appointed as one of Santam’s distribution partners, and 14,000 of its ministers have been trained on Santam’s Multi-Home product. Partnerships with Blue Financial Services, the Zionist Christian Church and Mr Price will assist in selling insurance to previously un-insured consumers in the lower-income segment, through products such as Multi-Home, Legal Access and funeral cover. We are further extending our footprint to include rural insurance by forming relationships with traditional rural leadership formations, such as the Congress of Traditional Leaders of South Africa (Contralesa) and Mpumalanga Housing.
We also leveraged our affiliation to the Sanlam Group to increase our exposure in the ELM by joining the Sanlam Group’s Ubuntu Botho Community Development Trust roadshow to present to shareholders in the Limpopo region. In addition, agents of Sanlam’s own ELM solution, Sanlam Sky, have received short-term insurance training.
As part of our proactive risk management strategy, we are developing various solutions designed to manage adverse environmental impacts and support a growing client awareness of environmental issues. Our new solar geyser initiative gives clients the opportunity to replace a damaged geyser with an environmentally-friendly solar-heated option in the event of a claim. Through this offering we also facilitate the conversion process, which entails modifications to conventional water heating systems. Energy efficiency has become a national priority, and as the first short-term insurance company to actively promote sustainable energy, we aim to support government’s drive to introduce alternative energy sources. We are also looking at ways to incentivise those clients who own a hybrid vehicle, or a vehicle with low carbon emissions. And we are investigating the possibility of new product offerings and policies in respect of green buildings.