Santam, South Africa's largest general insurer, has recorded a solid performance for the half year ended 30 June 2026, with growth of 10% (June 2025: 10%) in Gross Written Premium (GWP), an 8.1% (June 2025: 11.3%) Underwriting Margin (UWM) and a 6% (June 2025: 16%) rise in Net Earned Premium (NEP).
Profit attributable to equity holders of the company amounted to ZAR2,192m ($137.4m) in 1H2026, 7% higher than the ZAR2,045m posted in 1H2025. According to Santam, this was the result of the combination of a 17% year-on-year decline in the net insurance result from conventional business from a high comparative base, a marked increase in investment return earned on the capital portfolio and a 12% rise in ART’s contribution.
In a statement, Santam said, “The results were achieved despite a challenging macroeconomic environment, investment market volatility and significant weather-related catastrophe (CAT) events, and other large losses. During the period, gross claims paid to policyholders amounted to over ZAR12bn ($752m), ensuring a timely injection into the economy for clients at their time of need.
The UWM was above the midpoint of the 5%-10% target range.”
The weather events included devastating floods in the Limpopo province during January, while there was also a significant event in Western Cape in May. Overall, CAT and other large losses for the period amounted to ZAR1.5bn, net of reinsurance, compared to ZAR144m, in the comparable period.
Santam Group CEO Mr Tavaziva Madzinga said, “This performance reflects disciplined underwriting, sound expense management and continued strategic progress of our FutureFit 2030 goals. More importantly, key performance indicators remained in line with or exceeded long-term targets.
“Our steadfast focus on strategic execution enabled us to successfully navigate a challenging operating environment during the period.”
Conventional insurance growth
The GWP growth was supported by double-digit expansion at Miway, Santam Direct, Santam Re and Santam Partner Solutions, and a maiden contribution from the Lloyd’s-based Santam Syndicate 1918. The Syndicate had a strong start, concluding new incremental business with an Earned Premium Income (EPI) of ZAR1.3bn.
Property lines grew by 17%, supported by good growth across all traditional businesses, the first-time contribution by the Syndicate and the base effect of the MultiChoice transaction. The motor book benefited from broad-based contribution across personal and commercial lines, while engineering and liability classes delivered satisfactory growth (excluding Santam Re); crop was affected by weather conditions.
Miway grew 13%, benefiting from its diversified outbound, inbound and tied agency strategies. Santam Re achieved strong double-digit growth in GWP, attributable to new partnerships and increased participation in existing partner businesses. Santam Partner Solutions progressed well, supported by the MTN and MultiChoice device insurance business, which is performing broadly in line with expectations.
Broker Solutions and Client Solutions businesses achieved solid overall growth in GWP despite further moderation in premium rate increases and competitive pressure in outsourced business. Future growth is expected to benefit from the roll-out of the Santam CashBack offering, launched on 1 July 2026 to strengthen the group’s client value proposition.
Conventional insurance: Underwriting performance
An UWM of 8.1% was achieved in 2026, with personal and commercial lines delivering solid margins.
The underwriting performance for the period was adversely impacted by CAT and other large losses, mostly fire, including floods in Limpopo and Mpumalanga early in the year and the severe weather in the Western Cape during May 2026.
Overall, CAT and other large losses, net of reinsurance, of ZAR1.5bn in 2026 exceeded normal expectations and compare to ZAR144m in the comparable period. These losses were partly offset by a ZAR325m earnings benefit from a reduction in the group’s reserve sufficiency, from the 91st to the 87th percentile.
Despite these large losses and a maiden underwriting loss of ZAR230m from Santam Syndicate 1918, the overall Group net underwriting margin for the period was above the mid-point of the 5% to 10% target range. Attritional claims experience remained positive, supported by the improved underlying profitability of the in-force book following the underwriting actions implemented over the past few years, together with diligent expense management.
The Alternative Risk Transfer (ART) businesses delivered another strong performance, growing their profit contribution by 12% to ZAR466m (June 2025: ZAR417m). These earnings were supported by good return on capital, with other income lines broadly in line with the prior period. The group and all of its principal subsidiaries remain well-capitalised, with an economic capital coverage ratio of 167% (December 2025: 169%), above the upper end of the capital target range of 145% to 165%.
International diversification
International diversification and expansion remained a key strategic focus. GWP from outside South Africa contributed to 23% of the total (June 2025: 20%) and grew by 25% to ZAR5.3bn (June 2025: ZAR4.2bn), while the South African market, the group’s anchor at 77% of GWP, grew 6.4% to ZAR17.8bn.
Santam Syndicate 1918 commenced underwriting in London on 1 January 2026, complemented by a reinsurance office at India’s GIFT City on 1 April 2026. The Syndicate concluded new incremental business with an estimated premium income of ZAR1.3bn, of which ZAR461m has been recognised in GWP to date, with the balance earning in 2027 and 2028. Its initial loss reflects the delayed recognition of revenue under IFRS against fully recognised costs. However, the business is expected to contribute positively on an underwriting year basis.
Prospects
Santam said that the operating environment is expected to remain challenging in the second half of the year, with low economic growth, pressure on disposable income and investment market volatility likely to weigh on growth. Santam also expects competitive pressure in the intermediated and specialty lines of business to persist.
The Syndicate has a promising pipeline and additional approved capacity from Lloyd’s for the remainder of 2026. Most of the additional business to be written will only be recognised as earned revenue in 2027 and 2028 due to a delayed revenue recognition pattern, while the related Lloyd’s market cost and fixed costs will be recognised in 2026.
This, together with an expansion in the staff complement of the Syndicate in support of future growth, will increase its anticipated operational loss for 2026 to approximately ZAR450m to ZAR550m in 2026, dependent on the volume and type of business written. The new business is expected to contribute meaningfully to earnings in future financial years, with break-even on a monthly basis still anticipated in 2027.
In the absence of further abnormal CAT and other large loss events, Santam anticipates operating within the 5% to 10% underwriting margin target range.