Liberty, a leading insurance company in South Africa, is approaching its 70th year on a much stronger growth footing than on its 60th anniversary in 2017. The company has undergone significant changes in the past decade, including Standard Bank taking full control of the group. Founded by Sir Donald Gordon in 1957, Liberty has a long history of providing insurance products to South Africans. Under the leadership of CEO Yuresh Maharaj, the company is now focused on expanding its reach in the middle market segment.
Maharaj, who took over as CEO in 2023, has a clear vision for Liberty's growth. He believes that the company has a right to win in the middle market segment, which is currently underserved. According to data from the Association for Savings & Investment South Africa (Asisa), there is a large unmet need for life insurance in this segment, particularly among households with incomes between R8,000 and R40,000 per month. Liberty aims to increase its reach of simple life and funeral products in this market.
The middle market segment offers significant growth opportunities for Liberty. Maharaj estimates that this segment could grow to approximately R15bn of gross written premium over the longer term. To achieve this, Liberty will focus on designing products that are simple, affordable, and easy to understand. The company will also leverage its extensive distribution reach to make its products more accessible to customers. By targeting this segment, Liberty aims to add more value to its parent company, Standard Bank.
Liberty has recently exited the health insurance business in sub-Saharan Africa, citing operating losses and a lack of competitive scale. The company has also right-sized its rest-of-Africa portfolio to focus on markets where it has scale and a right to win market share. Maharaj emphasized that Liberty will be selective in its expansion, focusing on markets where it can see high returns on investment. Standard Bank is present in 20 countries on the continent, but Liberty will prioritize only a few of these markets.
South Africa remains the key market for Liberty, accounting for more than 70% of Africa's insurance market. However, the company also sees attractive growth opportunities in six African markets: Nigeria, Angola, Ghana, Kenya, Uganda, and Namibia. Maharaj noted that the medium-term growth expectations for these countries exceed that of South Africa, and Liberty's market position in most of these priority countries is outside of the top three.
As CEO of Standard Bank's Insurance and Asset Management (IAM) franchise, Maharaj is also overseeing the growth of the asset manager, Stanlib. Stanlib, which was established in 2002, has grown to be one of South Africa's large-scale asset managers, with about R800bn in assets. The entire IAM business has around R1.8-trillion in assets and has grown headline earnings to more than R4bn since its establishment.
The IAM business aims to grow its share of the open market and scale its asset management and investment capabilities. The unit targets growing its contribution to Standard Bank's earnings to about 15% by 2028. Since 2022, IAM has more than doubled its return on equity to 22.1% by the 2025 financial year, an outcome that is at the top end of its traditional insurer peer group in South Africa.
Key points
- Liberty aims to disrupt the middle market segment with its trusted brand and extensive distribution reach.
- The company has exited the health insurance business in sub-Saharan Africa and right-sized its rest-of-Africa portfolio.
- Liberty targets growing its contribution to Standard Bank's earnings, with a focus on six key African markets.
