GUARDRISK, South Africa's leading specialist insurance group, today announced that the gross premium revenue of its short-term and life insurance businesses increased by 12% to R2.8bn (2005: R2.5bn) for the year ended 31 March 2006.
Total shareholders? funds (including all cell owners' shareholders' funds) increased by 26% to R829m (2005: R659m); and the group's assets grew by 5% to R4bn (2005: R3.8bn).
The group's short-term operation, Guardrisk Insurance's, solvency margin (net written premiums to shareholders equity) increased to 42% (2005: 40%). The solvency margin is a key indicator of the company's ability to meet future claims.
The capital adequacy requirement of the group's life operation, Guardrisk Life, increased substantially to 5,5x (2005: 2,7x). The capital adequacy requirement - generally referred to as CAR - reflects the company's financial strength.
Guardrisk's solid results come at a time when alternative risk transfer (ART) insurers, like cell captives, face many challenges - especially in respect of the implementation of new disclosure requirements in terms of International Financial Reporting Standards (IFRS) and ongoing legislative changes that impact on the entire insurance industry.
"ART insurers" value proposition to clients has changed quite significantly over the last three years and those insurers that do not proactively keep ahead of what clients expect, are going to find it difficult, if not impossible, to grow their businesses," says Herman Schoeman, MD of Guardrisk.
He says that being a niche insurer is simply not enough anymore. "It is essential to carve out one's particular spot in the market place and, going forward, Guardrisk is going to become even more specialized and more focused on a few dedicated areas."
Guardrisk is a 100% subsidiary of the JSE listed Alexander Forbes Limited.
About Guardrisk
Guardrisk is the world's largest specialist cell and rent-a-captive group (in US$ terms). Guardrisk pioneered the cell captive concept, introducing cell captives to the short-term insurance industry in 1993 and extending the structure to the life industry in 1999. Cell captives provide underwriting, reinsurance, claims management, investment and accounting functions for clients (cell owners) who effectively enjoy all the benefits of owning their own insurance company. This keeps costs down and gives clients access to a broad base of insurance skills.
Contact:
Herman Schoeman
Guardrisk
Tel: +27 11 669-1002 or +27 82 376 3821
Prepared by:
Melanie Davis
PR at Work CC
Tel: +27 11 615-3309 or +27 83 225 7450
