In a second transaction with the JSE listed group, PSG Konsult (PSG), Absa Insurance and Financial Advisors Proprietary Limited (AIFA) signed a deal to sell its face-to-face Personal Lines short-term insurance brokerage to PSG.
The business consists of 83 advisers and over 31,000 clients with a personal lines focus.
“The sale of the Personal Lines (face-to-face) insurance brokerage business is part of the Barclays Africa Group’s decision to optimise its insurance distribution channels to respond effectively and efficiently to changing market conditions, technological advancements and increasing competition.
“In the first transaction, announced in September last year, PSG acquired AIFA’s Commercial and Industrial Lines short-term insurance brokerage business,” the bank said in a statement.
“Due to the prohibitively high investment required for the short-term face-to-face advisory business model and difficulties with scaling it up, we have taken a strategic decision to re-align ourselves as a bancassurer with a particular focus on direct distribution channels for short-term products,” said Bongiwe Gangeni, managing executive for distribution at Absa Wealth, Investment Management and Insurance.
The transaction does not extend to the Life and Investment Insurance brokerage and other insurance-related businesses such as, idirect, Absa Insurance Company or Absa Life Insurance.
“The impact of the sale is expected to be minimal to both the advisors and clients as existing advisor relationships with their clients will continue. The transaction will have no impact on the clients’ current insurance product/s or on their broader relationships across the Barclays Africa Group, Absa said.
The transaction remains subject to regulatory approvals.