Aon Speaks About Entry into South Africa's Insurance Market

May 9 - Aon, the New York listed insurance giant, recently acquired Glenrand MIB, putting the group in prime position to take on the local short term insurance market.

Guy Scott, a director at Aon South Africa and the Chief Executive Officer of Aon Risk Solutions spoke about the group's entry into the market and explained why Glenrand MIB was targeted.

"We've tried to buy it twice before but for various reasons the deals didn't go through," he said. "It's a case of third time lucky."

"Glenrand MIB offers us good people, a good direct business, a client base that includes about 30 JSE listed companies and a good client retention. And it creates a leadership position for us in SA and the rest of Africa," he added.

Aon hopes that by entering the market in a big way, it will be able to create a market leading position for itself this way.

The Chief Executive Officer for Aon South Africa, Anton Roux said that the group was very excited at the possibilities that the transaction and the combined teams would bring to benefit clients and colleagues.

A Question of Price

The group refused to disclose how much was paid for Glenrand MIB, with Scott saying that "we're a private company and the information is confidential."

He did say, however, that it was "fair value".

Industry experts, however, believe that Aon paid around R600 million for Glenrand MIB - what is termed as market price.

Challenging Direct Insurance

Aon promises to challenge the direct insurance model, made popular by brands such as OUTsurance.

"We believe intermediaries add value," said Scott. "We have a more professional offering, aimed at the high net worth market through Aon and now also the middle income personal lines clients, through Glenrand MIB."