PPS allocates over R4 billion in profits to members

28 March 2014 Mike Jackson, PPS
Mike Jackson, CEO of PPS.

Mike Jackson, CEO of PPS.

Profits returned to members* increased by 42% year on year.

PPS, the financial services company focused exclusively on graduate professionals, has announced that total profit share allocations to members* for the 2013 financial year rose 42% on the previous year to over R4 billion.
The company, which is the largest company in South Africa operating under a mutual model – meaning a business that is owned by its members and therefore returns profits to its members rather than shareholders – confirmed an increase in excess of 17% in PPS Group operating profits to over R1.0 billion.
Mike Jackson, CEO of PPS, says members have benefited hugely from sharing in the profits of the company in recent years. "Over the last 5 and 10 years, PPS has allocated more than R13.5 billion and R19.6 billion, respectively, to its members*, making it by far the largest and most successful mutual company in South Africa.”
On average, in 2013, members got 40% of their premiums back in their PPS Profit-Share Accounts, highlights Jackson. ”This is the vehicle that accumulates PPS members’ profit allocations. Our members have a unique value proposition by belonging to PPS, as they receive all the profits of the company. Upon retirement, they qualify for a lump sum pay-out of all the accumulated profits.”
Globally, the mutual industry has performed well over the past few years, says Jackson. According to latest statistics published by the International Cooperative and Mutual Insurance Federation (ICMIF) Chief Executive InSights report, the share of the global insurance market held by mutuals has grown by 26% since 2007, compared to just 11% for the listed insurance sector. "This shows increased consumer confidence in our business model, globally.”
The PPS Group announced its investment return for distribution to members rose 53% year-on-year to over R3 billion, up from R2 billion previously and achieved a record level of assets in 2013.
In addition to the profit allocation, Jackson says total gross benefits paid to members, including life, dread disease and disability claims amounted to R1.5 billion in 2013.
"We are extremely pleased with the performance of PPS during the last year. These results demonstrate the benefits of belonging to a mutual financial services company. As the PPS business continues to grow, our members* benefit by receiving all of the profits of the company.”
* PPS members with qualifying products.

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