Outsurance Group has delivered impressive earnings growth in the first half of its financial year, driven by stronger premium growth, higher investment income, and a significant drop in natural peril claims. The improved performance saw normalised earnings rise by 52.9% to R2.16 billion for the six months ending December. The company also declared an interim dividend of 88.6 cents per share, marking a 44.8% increase.
The group’s property and casualty division experienced a 17.4% rise in gross written premiums, boosted by steady organic growth across its various segments. Outsurance SA and Youi particularly benefited from disciplined cost control, while fewer claims from natural disasters further strengthened profitability. Meanwhile, Youi’s translated premium growth was slightly impacted by the stronger rand against the Australian dollar. Annualised new business climbed 17.9%, while the claims ratio dropped from 59.1% to 53%, thanks to improved working claims experience and better reserve management.
OUTsurance Ireland, launched in May 2024, is progressing as expected but reported R218 million in start-up losses, reflecting increased operating costs and early-stage contract losses. The company expects premium inflation to align with broader inflation trends over the next year, although climate change, electric vehicle adoption, and technological advancements in cars could result in higher premiums in the longer term.
Outsurance anticipates stable future growth as key cost-cutting strategies continue to support its competitive pricing model. With ongoing improvements in operating efficiencies and a more stable expense base once its employee share incentive scheme transitions to a new structure, the company is poised for sustained profitability. The group remains optimistic that a lower inflation environment and improved interest rates will further enhance growth prospects in both South Africa and Australia.