Hijackers have a prime target in South Africa-written by LUKE FRASER

[Nat Quinn]

Santam has seen a strong performance in 2024 but is becoming increasingly vigilant over increasing weather-related claims and high-value vehicle thefts, particularly delivery trucks.

Presenting its results for the year ended 31 December 2024, the insurance giant noted a massive 128% increase in high-value vehicle theft claims.

This is specifically on the commercial side, with delivery trucks as the main target.

This reinforces a growing trend over the past few years of these vehicle types being targeted by hijackers in South Africa.

Using 2019 as a base year, the group has been seeing an unsustainable trend in claims for these vehicles. In 2023, it imposed a range of correction actions on clients.

This included measures to minimise exposure, such as doubling up on vehicle trackers and promoting Faraday pouches to prevent the cloning of keyless access signals.

There have also been concomitant increases in insurance premiums in line with the heightened risks.

Several warnings related to delivery trucks and delivery vehicles have echoed across the industry.

The Road Freight Association (RFA) and security groups like Fidelity have repeatedly flagged spikes in the number of these vehicles targeted by syndicates.

The crimes are premeditated and show signs of growing sophistication, with criminals luring their victims by ordering deliveries only to ambush them when they arrive.

With bigger commercial cargo hijackings, syndicates and cargo thieves apply ‘mafia-style’ attacks on road freight vehicles.

Santam results

Santam delivered a strong performance in 2024 despite a challenging operating environment shaped by extreme weather events and accelerating economic and geopolitical uncertainty.

However, the group said that its FutureFit 2030 strategy and underwriting actions implemented over the last two years have positioned the group to deliver a marked financial improvement in 2024.

The group said it benefitted from double-digit premium growth, which exceeded its long-term strategy goals by a considerable margin.

The group’s underwriting margin also more than doubled from 3.5% in 2023 to 7.6% in 2024, within its 5% to 10% target range.

However, the group’s two largest insurance classes, motor and property, were both affected by a challenging claims environment.

Motor repair costs jumped by more than headline CPI, which the group said is not sustainable over the long term.

“We are working with key stakeholders to contain costs across the motor value chain over the long term,” it said.

The group also said that losses from extreme weather conditions were more pronounced in its property book.

It said that the frequency and severity of claims from inclement weather conditions also increased substantially over the past decade despite South Africa being seen as a benign catastrophe area.

The group said that these trends have persisted with weather-related catastrophe claims of R748 million, broadly in line with 2023.

“We have implemented several underwriting actions in the past two years in response to the elevated claims environment,” it said.

This included segmented premium increases and higher excess amounts for selected risks across its motor and property classes.

Moreover, the group said that high inflation and interest rates over the period hurt consumer disposable income, while high unemployment also suppressed any real growth in the size of the consumer base.

These issues resulted in a negative impact on the affordability of insurance premiums and new vehicle sales, which are key for the businesses’ growth.

Financials

The group said that its strategic actions improved profitability across its portfolio, which drove a robust financial performance in 2024.

It added that most of its conventional insurance businesses contributed positively to premium and profit growth.

Overall, group insurance revenue increased by 12%, from R46.8 billion to R52.3 billion.

Basic earnings per share rose by 13% to 3,356 cents per share, while headline earnings per share jumped by a massive 51% to 3,477 cents per share.

The group also upped its ordinary dividend per share by 9% from 905 cents per share to 985 cents.

 

 

SOURCE:Hijackers have a prime target in South Africa – BusinessTech

 

 

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