Less Claims Against Santam Insurance

February 26 - Share prices for Santam Insurance remained unchanged on the Johannesburg Stock Exchange this week, despite the news posted by the company that second half profits had increased five fold.

The reason for such a high profit turnover, according to Santam Insurances, is that a significantly less number of policyholders made claims in this time period. Santam is one of South Africa's largest property and casualty insurers with a majority share of the market in many sectors.

In a statement, a spokesperson for the group said: "Santam experienced a substantially improved second half of the year mainly due to fewer large industrial accidents and fire related claims."

The company said that net income in the last six months of 2008 rose to an impressive R624 million, up from R122 million only one year previously.

Equity losses that were experienced in the first half of the year were recovered after Santam sold R1 billion worth of shares, said the statement. It also took out hedges to protect itself from losses on R500 million worth of equity investments.

The news was a lot better than last year's when, for the first time in six years, Santam Insurance stock lost nearly 25% of their value.

Overall, Santam said that full year net income dropped to R724 million (from the previous year's R1.05 billion). In terms of stock value, this was a drop from R9.14 a share to R6.40 a share.

Santam also said that its profit from underwriting rose by 11% to R752 million.