Santam resumes dividend payments

South Africa's largest short-term insurer, Santam, has reported a 30% increase in headline earnings as the economy bounces back from the lockdowns enforced during the COVID-19 pandemic. The company has also announced the resumption of dividend payments, a move welcomed by shareholders. Lise Lambrechts, the CEO of Santam, recently sat down with CNBC Africa to discuss the company's performance and future outlook. Despite the challenges posed by the pandemic and other unforeseen events, Santam has shown resilience in its operations. One of the key highlights from the recent financial results is the 5% increase in gross written premiums, driven by growth in both corporate and retail segments. The agriculture business segment, in particular, saw a remarkable 11% growth in premiums over the past six months. Lambrechts attributed this growth to a combination of factors, including market demand and effective business strategies. However, the company did face a decrease in cash generated from operations, primarily due to large corporate fire claims and other non-pandemic-related factors. Lambrechts noted that while some funds were utilized for COVID-19 claims, the main focus remains on addressing business interruption claims. Santam has already paid out 1.7 billion rand in claims related to the pandemic, with additional claims still being processed. Despite ongoing uncertainties, including intermittent lockdowns, Lambrechts remains optimistic about the economic recovery and business prospects in South Africa. She emphasized that Santam is committed to supporting its clients and ensuring a seamless claims process. Regarding the recent social unrest and riots in July, Lambrechts clarified that Santam's exposure to these events is limited, as most damages are covered by reinsurance. The company is actively assisting in processing claims to expedite relief efforts. When asked about Santam's international operations, Lambrechts acknowledged the challenges in Lebanon due to the country's financial crisis. She mentioned that the investment in Lebanon has been written down, but the business operations are being continued with support from the company. Looking ahead, Lambrechts highlighted the importance of sustainable growth and maintaining a profitable underwriting margin to keep shareholders satisfied. Despite external perceptions, Lambrechts emphasized Santam's commitment to addressing the needs of its policyholders and ensuring timely claim payments. The company has already disbursed substantial amounts to policyholders, especially small businesses impacted by the lockdowns. On outstanding legal matters, Lambrechts mentioned a high court case regarding the indemnity period for claims, with a judgment expected in the coming weeks. Santam remains focused on legal compliance and providing support to its clients in challenging times.