PPS, a South African member of the International Cooperative and Mutual Insurance Federation (ICMIF), is today celebrating its 75th Anniversary and has taken the opportunity to reveal strong growth in member numbers and some significant new business initiatives, which include the transformation of PPS Short-Term Insurance into an insurance company and the launch of PPS Mutual in Australia. PPS is a mutual and specialist financial services provider to the graduate professional market in South Africa. Celebrations were led by Mike Jackson (pictured right), CEO of PPS and an ICMIF Board member and Shaun Tarbuck, Chief Executive of ICMIF attended the celebrations.
Speaking at the launch of PPS’ new Five Green Star rated office block, PPS Centurion Square, Mike Jackson says that these milestones once again serve to highlight the benefits to the company and its members of operating under an ethos of mutuality.
“Despite the economic challenges in 2015, PPS still had an excellent year with respect to growth in membership. More than 7,500 new members joined PPS in 2015 – up by 35% on the previous year – and the growth among student members from across a broad spectrum of campuses is particularly pleasing. While we will only announce our final 2015 results on 26 April, we have certainly experienced significant new business growth this past year.”
Jackson explained that unlike listed financial services companies, in which all profits accrue to shareholders, PPS operates under the ethos of mutuality, which means that the company exists solely for the benefit of its members, and in fact shares all of its operating profits and investment returns with members on an annual basis by way of allocations to their PPS Profit-Share Accounts. “The fact that PPS doesn’t have external shareholders means it is able to concentrate on its long-term commitments. Unlike a listed company, PPS also has no need to set aggressive profit targets, in order to deliver short-term, volatile returns to shareholders.”
Since the inception of PPS in 1941, the company has focused exclusively on servicing graduate professionals in South Africa, says Jackson. “Professionals continue to be in high demand in the country as a vibrant professional sector which is critical for economic growth. As the company enters its 75th year, PPS will continue to serve its members by providing world class financial services covering their unique needs from graduation to retirement.”
A major development for the company this year is that PPS Short-Term Insurance, which has been operating successfully as a brokerage for the past seven years, has transformed its business model to that of a short-term insurer. The company will continue to focus on the short-term insurance needs of the South African graduate professional market.
According to Nazeer Hoosen, Chief Executive Officer: PPS Short-Term Insurance Company, following the successful growth of the business, paired with a better understanding of the specific risks of the graduate professional market, the business has entered the next phase of its strategic roadmap. “By becoming a short-term insurer, we are now able to design and underwrite new products that provide innovative solutions which address the evolving needs of our members, in both their private and professional capacities.”
In addition to this, PPS recently announced its replication of its business model in Australia with the launch of PPS Mutual in Sydney earlier this month. Jackson says the decision to expand into Australia followed extensive market research by Australian consultants, on behalf of PPS. “The study clearly showed a gap in the Australian market with regards to a specialised mutual dedicated to servicing the insurance needs of the growing graduate professional market in the region.”
PPS Mutual will operate under an ethos of mutuality but has been established as a separate entity from PPS. However, the board will comprise of 50% representation from South Africa, ensuring the success and knowledge is shared with the Australian management team.
Globally, the mutual and cooperative business model has been the fastest-growing part of the global insurance market, increasing from a global market share of 23.5% in 2007 to 27.1% in 2014, according to statistics from Global Mutual Market Share data published by ICMIF. In Africa alone, there are now about 40 mutual/cooperative insurance companies which serve about eight million policyholders.
Shaun Tarbuck, CEO of ICMIF, says; “Having worked closely with PPS over the last few years I can honestly say they are an excellent organisation with exemplary leadership. Within the mutual sector globally, they are certainly one of the thought leaders at ICMIF. Their continued focus on putting the member at the centre of all their strategic decisions and the values is evident of their commitment to the communities they serve.”
“The launch of the short-term insurance service is happening at an appropriate time for the company and is another added value for members. In addition, taking this unique business model to Australia is a logical and exciting strategy that will be well received by the professional community in Australia. PPS is a company with a clear and exciting mission, great values, and excellent leadership and I am very sure that the next 75 years will prove to be very interesting,” concludes Tarbuck.
Today’s celebrations also marked the opening of the PPS Centurion Square office development. This new development is situated in the heart of the Centurion Central Business District and consists of two open plan office buildings situated on a total area of 23000 square meters and it has received a Five Star Green Building Rating from the Green Building Council of South Africa (GBCSA).
Tiffany Boesch, Group Financial Director of PPS, says the company is proud to be part of the development as it is PPS Property Fund Trust’s latest green office development. “Investing in green technology will not only lead to cost reductions in the long term, but will also result in reduced use of resources and have a positive impact on the health and wellness of the occupants and surrounding community.”
Picture shows Mike Jackson speaking at the 75th anniversary celebrations at the new office block, PPS Centurion Square.