Chamwe Kaira
Sanlam Limited has reported a decrease in Value of New Business (VNB) for the year ended 31 December, partly linked to the disposal of its Namibia operations to SanlamAllianz in 2024.
The company said the decline was largely driven by a shift in product mix in South Africa, where clients continued to favour market-linked or living annuities instead of life annuities.
“This was compounded by development costs associated with establishing new distribution channels in India as well as by the cessation of the Capitec partnership and disposal of the Namibia operations to SanlamAllianz in 2024,” the company said.
Sanlam reported growth in new business volumes and strong cash generation for the year despite pressure on value of new business.
Group new business volumes increased by 18% on an expected basis and rose by 22% in actual terms. The company said this reflected higher client demand across distribution channels.
Life new business volumes grew by 10% on expectation but increased by 17% in practice during the period. The company said this performance was supported by continued market penetration and adjustments to its product mix.
The group also recorded strong client funding activity, with net client cashflows increasing by more than 100% compared to the previous period. This reflected sustained inflows into Sanlam’s investment and savings platforms.
Discretionary capital increased by R3.94 billion, reflecting the group’s capital position and its ability to support strategic initiatives while maintaining financial flexibility.
Overall, the 2025 results reflect Sanlam’s focus on expanding new business, maintaining client cash generation and improving operating performance despite a difficult margin environment.
“We continue to deliver strong growth and operating performance amid a turbulent macroeconomic backdrop, marked by heightened geopolitical tension, market uncertainty and currency volatility. The group’s performance demonstrates our ability to navigate complexity, capitalise on emerging opportunities and maintain financial strength, positioning us to deliver sustainable value for our shareholders.”
The increase in group new business volumes marks a record annual performance for the group. This was driven by strong flows into its South African asset management operations and contributions from life and general insurance.
Life insurance new business growth was supported by performance in Sanlam corporate, market-linked or living annuity and risk sales. Lower life annuity sales partly offset this growth after bond yields declined.
General insurance new business volumes increased with double-digit growth recorded in the South Africa and India businesses. In Pan-Africa, sales were affected by weaker corporate volumes.
Net client cash flows more than doubled, with contributions recorded across all lines of business.
Discretionary capital increased by about R4 billion following the partial sale of the group’s stake in the SanlamAllianz joint venture. The company said the decision allowed it to raise cash upfront while giving up part of future earnings to strengthen the balance sheet and fund growth.
Caption
The disposal of Sanlam Limited’s Namibian operations to SanlamAllianz in 2024 contributed to the decrease in value of new business for the year ended 31 December.
- Photo: Contributed
