Insurer King Price says it is seeing ‘significant’ growth in its corporate and commercial book, with more than R200 million in business signed this year in what is largely a broker-driven market.
King Price CFO Rhett Finch says the company has targeted commercial insurance as a key growth segment as it looks to continue its exponential rise in the local market. From a R100 million start-up in June 2012, King Price has grown to a R3.3 billion business today – contributed to, in no small way, by year-on-year growth of 94% for its 2018 financial year.
Finch says King Price’s 15% shareholding by Germany-based global reinsurance giant Munich RE has given the company the financial leverage to write bigger risks in the commercial space and give the market peace of mind that it will be able to pay any potential claims.
“Our message to the market is clear: We’re a serious player in the corporate and commercial space. We’ve got the most favourable reinsurance terms in the market, and our reinsurer has a better credit rating than South Africa’s big four banks, which gives us the foundation we need to grow this side of the business quickly and sustainably,” adds Finch.
King Price believes the key to its growth in the highly competitive commercial space lies in its focus on the broker channel. “Today, broker sales make up 25% of our business. By emphasising value and service, and treating our brokers at the same level as our direct channel, we’ve been able to grow our broker business to a half-billion Rand business in the past 3 years,” explains Finch.
Another key differentiator that the company will be looking to exploit is its agility, with its industry-leading ratings box allowing it to make major underwriting decisions within as little as 24 to 48 hours.
The company is also quietly growing its business in niche segments like engineering, where a big part of its book is yellow metal; and agriculture, where it currently provides cover for assets and livestock. It also plans to start providing insurance products to the marine sector in early 2019.
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