In 2023, one of its primary objectives was the final transition of PPS Profit-Share assets from external fund managers to PPS Multi-Managers, who are now managing all PPS assets. A further objective was to sustain new business levels during the change in the distribution model and in the face of challenging economic conditions in South Africa. At the leadership level, the CEO of 16 years, Nick Battersby, was appointed to the newly created Deputy Group CEO post and replaced by Shaun Ruiters. Shaun has previous experience at PPS. This change in leadership was seamlessly handled, a fact evident from the business’s results. Assets under management increased to R84 billion by the end of 2023 from R66.67 billion a year earlier. Gross inflows stayed steady at R7.6 billion, while profit before interest and tax increased to R153 million from R121 million in 2022, surpassing anticipated profit levels. Members benefit from our investment strategy in two ways: through growth in the value of their individual portfolios and through growth in the contribution the business makes to their PPS Profit-Share Accounts™. PPS Short-Term Insurance PPS Short-Term Insurance provides intelligent shortterm insurance solutions for our members, including car, home and business insurance. In 2023, its primary objectives were to achieve the gross revenue target for the year in pursuit of its business plan to achieve scale, maintain a loss ratio and lapse rate within predetermined parameters and position itself effectively for growth into new market segments. As in the previous period, the business and the industry experienced high levels of climate-related claims during 2023. Yet, we are proud that the claims ratio remained below expectations. As I have mentioned in previous reports, we remain convinced that the professional segment is a benign one from a short-term insurance risk perspective due to the ethos of risk management common in many professions. This ultimately benefits our members through profit-share. We are pleased to report that this business is now close to a break-even position and is projected to be a significant contributor to profits in future. PPS Health Professions Indemnity PPS Health Professions Indemnity is a dedicated business operating on our short-term insurance licence, offering indemnity insurance for healthcare professionals registered with the Health Professions Council of South Africa and working in clinical practice. Launched five years ago, the business is now profitable. It recorded an exceptional increase of 15% in the number of new non-Pharmaceutical Society of South Africa (PSSA) policies written during the reporting period and, partly due to the nature of the cover it offers, recorded an exceptionally low lapse rate. Service is a key differentiator and not only contributes to the low lapse rate but also continues to drive the ongoing growth in the number of insured professionals choosing PPS Health Professions Indemnity as their indemnifier of choice. It continued to generate a profit before interest and tax. It extended its offering to Namibia members, which was well received. It has built a solid book with a good risk mix. By the end of the year, 12 609 (including PSSA members) medical professionals enjoyed the cover provided by this business. Unlike other providers operating in this market, PPS Health Professions Indemnity uses a risk-adjusted model to assess the risk profile of each practice individually to determine the cost of its indemnity insurance. This reflects our ethos of mutuality, a guiding principle that drives our mission to provide every member with the complete value that PPS has to offer. PPS Healthcare Administrators PPS Healthcare Administrators again delivered a very solid performance in 2023. Profit before interest, tax and lease modification were ahead of forecast, and fees continued to track within the industry average. Revenue of R358 million was 4% up on 2022. A major achievement during 2023 was to roll out administration services to the Botswana Public Officers Medical Aid Scheme (BPOMAS), effective from 1 July 2023. This is the first client of PPS Healthcare Administrators outside of South Africa. The business will pursue other opportunities in neighbouring countries in future. 25 Leadership commentary
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