Lion of Africa to close its doors

South Africa’s tough economic climate has had a poignant effect on the financial services industry. Some of the challenges we as an industry face, which is probably similar to many industries, are generating new business, retaining clients, staying profitable and keeping skills within the company relevant. Some get it right, others don’t…

On 13 November 2018 FAnews received a letter from a reader which was sent to all Lion of Africa Stakeholders in which the company announced that it would be closing its doors. 

Dear Business Partner 

LION OF AFRICA INSURANCE COMPANY TO CLOSE 

The Board of Johannesburg-based short-term insurer, Lion of Africa Insurance Company (“Lion” or “the Company”), has decided to voluntarily and systematically wind down operations with immediate effect. Over the past few years Lion has experienced a lack of profitability and a tough operating climate in its chosen markets which combined with an onerous regulatory environment and increased solvency requirements contributed to this decision. 

The decision was not taken lightly and significant efforts were made to find alternative solutions.  Notwithstanding our efforts the Company is being placed into “run-off”.  Lion will continue to meet all obligations under existing policies but will not be issuing any new policies.  We wish to give all policyholders our assurances that all valid claims will be honoured, and complaints and queries lodged by policyholders will be addressed. 

The Company has already informed its employees and the Regulator of its decision. Our employees worked hard over the years to build a solid brand and together with the management team and the Board, did everything possible to get the business on a sustainable and profitable path.  Our hearts go out to the employees and their families. We have acquired the services of counsellors to assist them to deal with this difficult situation. 

We wish to thank you so much for your support. Without you, we would not have been able to grow the business and serve you to the best of our ability.  In the coming months we will be working on “running-off” the business. We will make sure we meet with as many of our stakeholders as possible. This will enable us to ensure that the “run-off” of the business is completed in an orderly fashion and none of our clients are negatively affected. 

I thank you. 

Anees Vazeer

Acting CEO

Lion of Africa Insurance Company   

Editor’s Thoughts:
This is a sign of how significantly a poor economic climate can affect the financial services industry. We hope that there is positive news in 2019 and that government can resolve the country’s economic woes. It is now critical to make sure clients are not affected. Please comment below, interact with us on Twitter at @fanews_online or email me your thoughts jonathan@fanews.co.za