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Africa Outlook

Mutual & Federal
Africa finance
South Africa finance
Africa insurance
South Africa insurance
marine insurance
agri insurance
agriculture
engineering insurance

MUTUAL & FEDERAL

Not many globally successful enterprises can boast the extent of experience that Mutual & Federal has in South Africa’s insurance domain, but the Company’s commitment to innovation is as strong as ever today

186 Years of Heritage and Innovation

 Writer:Matthew Staff

 Project Manager:Stuart Parker


 As experts across personal, commercial, agriculture, engineering and marine insurance, Mutual & Federal’s reputed name is derived from an extensive range of products and solutions that fulfil South Africa’s personal, commercial and corporate needs.

 Made up of Personal, Commercial Lines and Distribution; Corporate and Niche; Agriculture; and Credit Guarantee Insurance Corporation of Africa, these four divisions combine to affirm its position as not only the most experienced, but one of the most diverse and trusted operator in the country.

 “On the Commercial side, for the small to medium sized enterprise (SMEs), we cater to all insurance and risk needs,” explains the Company’s Chief Operating Officer (CEO), Michelé Schliesser. “Solutions include cover for business interruption, theft of money, legal liability, company fleet vehicles, and fraud losses, amongst others. Furthermore, we offer specialised insurance for niche businesses and professions including medical practitioners, veterinarians and florists to name just a few examples.

 “Within our Personal division, we offer insurance cover for personal belongings - including home, household contents and vehicles – as well as offering personal all-risk and liability cover, hospital plans, and various forms of personal accident policies.”

 Mid-sized and large multinational organisations are catered for via Mutual & Federal’s corporate arm in offering asset protection, fire cover, accident and motor fleet insurance, and much more; while its origins in the Agriculture domain are addressed through tailored insurance services to assist farmers in running their businesses.

 “Other specialist areas of our corporate insurance services include Engineering, Credit Marine Insurance, as well as Risk Financing insurance entities. Throughout everything, Mutual & Federal prides itself on its claim paying ability,” Schliesser says.

 She continues in detailing the Company’s other key market differentiators: “We pay all legitimate and valid claims. We also pride ourselves in being the oldest insurers and one of the oldest businesses in South Africa, having operated continuously for 185 years.

 “We were recently rated as South Africa’s third best short-term insurance brand in the business category of the 2016 Sunday Times Top Brands Survey. This followed soon after South Africans rated us as the second best and most-improved short-term insurer in the SA Customer Satisfaction Index (SAcsi) in June, 2016.”

 Impressive gains

Nearly 200 years of experience is a feat difficult to rival in any industry, let alone a relatively fast changing insurance sector which calls for the most forward-thinking, innovative and trend adhering strategies in order to succeed.

With age comes experience though, and having witnessed every domain fluctuation up to this point, no Company is in a better position than Mutual & Federal to prepare for every eventuality and client requirement.

 “The forerunner of Mutual & Federal, the South African Fire and Life Assurance Company, first opened its doors on 14 March, 1831,” Schliesser looks back. “After trading profitably for 64 years, South African Fire and Life was then acquired by London & Lancashire which, in turn, was absorbed by the Royal Group in 1962.

“In the 1960s, South Africa became a republic and the Government directed that all branches of foreign insurance companies operating locally should be registered as South African companies and trade on the Johannesburg Stock Exchange. This conversion became known as the ‘domestication of foreign companies’.”

 As a result, the majority of the Royal’s businesses in South Africa merged with Old Mutual’s short-term company, the SA Mutual Fire & General Insurance Company, in 1970. Then, to assume a truly South African identity, ‘Mutual’ and ‘Federal’ elements were united to create the brand that is known today.

“Mutual & Federal Insurance Company was born and the rest – as they say – is history,” affirms Schliesser.

 Since that moment, the Company has undergone numerous diversifications and expansions to ensure it is meeting the widest range of customer demographics possible, with as strong a service portfolio as possible.

The past few months alone epitomise this ethos in overseeing a number of significant milestones.

 Schliesser notes: “Not only did we launch several products to fulfil our mandates, but the Company also recorded impressive gains in its customer service levels as measured by the decline in cases or claims decisions overturned by the Ombudsman of the Short Term Insurance (OSTI).

“The first product we launched was prosure, which was rolled out in May, 2015. Mutual & Federal followed the launch of prosure with the rollout of the motorsure product a month later in June, 2015.  The launch and subsequent take-up was a great success with the Company signing up more than 5,000 active motorsure policies by December, 2015.”

 Motorsure now serves as the Company’s new motor-only policy specifically designed to protect customers’ motor vehicles against accidents, fire and theft and has received immediate critical acclaim.

 “The early success and support received from intermediaries for motorsure indicates that this product solution adds great value to customers and at the same time, filled a key product demand gap that existed,” Schliesser adds. “More recently, we have also introduced various value added services to strengthen our online offering to our customers. These new online functionalities meet the needs of our customers and expand our customer-focused solutions.

 “’Find a Broker’, ‘Glass Claims’ and ‘Household Content Calculator’ are the three solutions in question and the latter especially will enable online users to easily estimate the value of their home contents and the search tool will help customers to locate a broker or adviser in their preferred province, city or suburb, to provide short-term insurance advice.

 “These tools could also further provide a platform to generate leads for our brokers and advisers.”

 Technological advancements

These products were added after recognition from Mutual & Federal that the industry market is largely a digital one in the current age. And considering Africa’s position as one of the global leaders in mobile phone usage and emerging uptake, the need for quick and easy tech solutions was clear for the Company to see.

 “Technology is manifesting in multiple aspects, and is going to shape the way we do things. We are currently seeing pockets of technological advancements,” she explains. “A key ability that technology will unlock is the ability to multi-channel; interacting with clients and aspirant clients on multiple platforms.

 “The ability to bring those channels together seamlessly is a key challenge though. We are seeing more companies moving from legacy and mainframe systems to more server-based technologies.”

 Fortunately, Mutual & Federal has a concerted history of being able to start and complete the value chain in whichever way the market requires, and the same has been true in the digital age. The majority of industry players have begun to complete their transitions from legacy systems to more server-based systems, and this is an aspect which the organisation will look to refine further in the future.

 “Going forward, we need to digitise a lot more of the value chain,” Schliesser affirms. “Most insurers have launched apps as a step towards achieving this. Another key technological trend we are researching is gamefication; especially in the realm of apps for driver behaviour.

 “Telematics is another area companies should be putting resources into. It would allow them to price at an individual behaviour level as this technology will allow them to take individual driver behaviour into account. Accident management services will also change.”

 Oldest and most trusted  

Behind every technological improvement, capital investment and strategic decision is a workforce of more than 2,300 skilled and committed people across all of Mutual & Federal’s branches in South Africa; dedicated from top to bottom to empower customers and put them at the centre of everything the company does.

 “Our commitment to employment equity and Broad-Based Black Economic empowerment (B-BBEE) is demonstrated by a workforce which is 68 percent black and 58 percent female,” Schliesser states. “Mutual & Federal uses an integrated talent management framework to identify high potential leaders in the organisation, who are placed in our various management and leadership development programmes.”

 As part of this HR ethos, there is also a strong commitment to localisation, ensuring that South African beneficiaries of the Mutual & Federal offering include people within the business as well as outside of it.

The supply chain receives the same treatment where possible by adopting a local procurement policy as well as a bias towards smaller operators and female-owned businesses.

 All of this extends into the Company’s tailored corporate social responsibility (CSR) efforts aimed at areas outside of the business’s initial remit.

She says: “Mutual & Federal’s CSR programme focuses on activities that complement our business operations within the short-term insurance industry, while simultaneously aligning with the Company’s own transformation objectives and addressing the needs of many underdeveloped communities.

 “Investments are particularly focused on initiatives relating to education (especially mathematics and science) and agricultural socio-economic development in order to make a sustainable difference in the lives of beneficiaries. An increasing focus at Mutual & Federal will be the encouragement of staff volunteerism both in terms of hands-on involvement and identifying desirable projects within their own communities.”

 Providing innovative solutions to both its clients and these peripheral communities has formed the basis for Mutual & Federal’s success over the centuries, and the overriding ambition remains the same in becoming the short-term insurer of choice in the country; trusted by a loyal, financially-protected customer base.

She concludes: “On 16 October, 1916 the first Agricultural Insurance Policy was issued in South Africa and we were part of that historic event.

 “100 years later and we still lead the pack in crop and agricultural asset insurance with innovative solutions for farmers. We intend to keep growing and serving our valued customers for many years to come, so that they can reap the rewards of being insured by the oldest and most trusted agricultural insurer in South Africa.”