South Africa’s millionaire life insurance bosses – earning up to R32 million
The market for Iife insurance is booming in South Africa, and the CEOs of South Africa’s biggest listed groups that offer Iife insurance are paid as much as R32.32 million, or R88,548 a day.
Despite the difficult economic climate in South Africa over the past couple of years, life insurers have proved to be remarkably resilient.
According to the long-term insurance statistics published by the Association for Savings and Investment South Africa (ASISA), policyholders and beneficiaries received R599 billion in 2023 from life insurers that are members of the ASISA.
Life insurers managed 43.8 million risk and savings policies on behalf of policyholders at the end of December 2023.
Gareth Friedlander, a member of the ASISA Life and Risk Board Committee, said the key indicator of the industry’s health is the average solvency buffer, which was just more than double (2.07) the Prudential Authority’s Solvency Capital Requirement (SCR) as at the end of December 2023.
Friedlander explains that strong capital buffers ensure that life insurers are in a position to pay claims and policy benefits, even in times of extreme market turmoil and unusually high claims.
At the end of December 2023, the life insurance industry had assets of R4.08 trillion and liabilities of R3.72 trillion.
This left the industry with excess assets of R366 billion, while the SCR was R176.7 billion.
This translated into notable peroremces for South Africa JSE-listed life insurers.
Sanlam reported a “robust” operating performance for the first six months of 2024, with new life insurance business volumes in South Africa up by 15% on a PVNBP (present value of new business premiums) basis.
New life insurance business volumes increased by 14% to R51.044 billion across the group’s three operating regions: South Africa, Pan-Africa and Asia.
The value of the new covered business was up 10% to R1.394 billion, and life insurance net client cash flows increased by 42% to R10.6 billion.
Additionally, Old Mutual’s financial results for the year ended 31 December 2023 revealed that despite a challenging operating environment characterised by high inflation, elevated interest rates and muted economic growth in South Africa, the group saw sales growth of 17% in its key life segments, with it growing market share profitability in its key markets.
Net client outflows of R7.51 billion improved by 40% from the prior year and were primarily driven by good inflows in its life business.
These performances are party thanks to the decisions and execution of their respective CEOs.
CEOs must ensure that their institutions remain competitive and navigate regulatory and compliance issues in a highly regulated environment.
They must ensure that their institutions adhere to government policies while also adapting to rapidly evolving industry trends, such as digital transformation.
CEO pay
BusinesTech examined the CEOs of the five life insurance groups listed on the Johannesburg Stock Exchange (JSE) to determine their earnings last year.
These companies are Sanlam Limited, Discovery Limited, Old Mutual Limited, Momentum Metropolitan Holdings, and Clientele Limited.
Old Mutual’s Chief Executive Iain Williamson, the top-paid CEO on this list, earned a whopping R32.32 million.
This works out to R622,000 per week and R88,548 per day.
This figure includes base salary, short-term incentives, cash bonuses, benefits, and long-term incentive plans.
This is over five times the salary paid toSanlam’s Paul Hanratty, who took home the ‘smallest’ amount of R6.13 million.
However, in 2020, when Sanlam CEO Paul Hanratty started his job, it was with a rather unusual CEO pay structure.
He was awarded five million Sanlam shares that could be cashed out after five years. This was instead of a mix of salary, share awards and bonuses, which most CEOs receive.
Hanratty’s contract guaranteed 10% of his final payout, and to this end, he is paid a set amount of R6.13 million in cash every year for five years.
At current share price levels (R83.70), the five million shares have a maximum value of almost R419 million, or R83.8 million per annum.
However, the number of shares he will actually receive in 2025 is subject to certain performance conditions.
Discovery’s Adrian Gore was the second-highest earner of the three, taking home R28.31 million, or R77,562 per day.
It must be noted that some of these companies have dedicated CEOs or directors of their life assets; however, some are not included in their remuneration reports.
Additionally, Jeanette Marais succeeded Hillie Meyer as Momentum Metropolitan’s group CEO as of 1 August 2023, making her the first woman CEO of a large, listed life insurance and asset management group in South Africa.
The table below outlines what these CEOs earned in 2023 and how that translates per week.
| Company | CEO | Market Cap. | Annual remuneration | Earnings per day |
|---|---|---|---|---|
| Sanlam | Paul Hanratty | R178 billion | R6.13 million | R16,795 |
| Discovery | Adrian Gore | R102 billion | R28.31 million | R77,562 |
| Old Mutual | Iain Williamson | R61 billion | R32.32 million | R88,548 |
| Momentum | Jeanette Marais | R38 billion | R22.56 million | R61,808 |
| Clientele | Basil Reekie | R5 billion | R15.25 million | R41,780 |
| Average | R76.8 billion | R20.91 million | R57,288 |
Read: The 6 people in charge of interest rates in South Africa
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