Insurer Momentum Group has reported cost savings as a result of the deployment of digital technologies, such as artificial intelligence (AI) and automation.
This emerged when the JSE-listed financial services firm today announced its interim results for the six months ended 31 December.
Normalised headline earnings increased by 8% to R3.7 billion, while operating profit increased 10% to R3.1 billion, underpinned by solid performance across business units. Return on equity remained robust at 24%, above the group’s target of 20%, it says.
Jeanette Marais, Momentum Group CEO, says digital innovation is a core driver of performance. “Our practical application of digital and AI creates a compounding structural advantage for the future.
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“AI is not an emerging capability for us; it is already delivering measurable value. We have 60 active digital initiatives focused on risk mitigation, cost-efficiency and adviser enablement. Just seven of these have already generated R40 million in savings by automating processes and unlocking capacity for higher-value client support.
“The next step is to continue scaling the initiatives that work, and to embed AI and intelligent automation as a compounding structural advantage for the group.”
Sales showed double-digit growth in volumes, with the present value of new business premiums increasing by 11% to R43.3 billion.
According to the insurer, this was driven by strong performance from Momentum Investments, Momentum Corporate and Momentum Africa.
It notes the value of new business (VNB) decreased 15% year-on-year to R238 million, primarily due to a shift from higher-margin guaranteed annuity sales to living annuities.
Marais notes that improving VNB remains a strategic priority. “Although we are encouraged that VNB increased in all businesses except one, and that VNB improved by 25% when compared to the previous sequential six-month period, it is a key focus for us to further improve the value of new business across all business units.
“It is encouraging that as the VNB contribution from guaranteed annuities continue to reduce as sales volumes decrease, other businesses are starting to compensate.”
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