Tried, tested and trusted for over 70 years, PPS is recognised as a company of value, repute and integrity by professionals throughout South Africa and across the world. FAnews spoke to Mike Jackson, CEO of PPS Insurance, to uncover the secret to sustaina
The brainchild of a group of eight dentists, PPS was founded as the Professional Provident Society of South Africa on 8 July 1941, at the height of the Second World War. This group of pioneers understood that the professional person's assets are knowledge and skills, which must be employed to the fullest extent to earn a living. The unfortunate experiences of some of their colleagues on active duty motivated them to seek a better system of financial protection against the serious consequences arising from inability to practise because of sickness or injury.
A unique business model
The unique business model of PPS offers "ownership" to its professional members - lawyers, doctors, accountants, engineers and many other professionals. “Unlike a company listed on a stock exchange, PPS belongs to its members and operates under the ethos of mutuality,” explains Mike Jackson, Chief Executive Officer of PPS Insurance. “This means that it does not offer shares on any public stock exchange and answers only to the professional members it serves. It is operated and maintained for the sole benefit of its professional members who participate in a broad spectrum of products and services.”
Members may be voted onto the Board of the PPS Trust, which also has representation from the professional associations. Policyholders share exclusively in the profits of the PPS group, through the unique Surplus Rebate Account (SRA). In 2010 alone, PPS allocated over R2 billion to members' SRAs.
“PPS members know that PPS is exclusively there for them and their families through every stage of their lives - from graduation to retirement and beyond,” comments Jackson. “The success of PPS is largely due to the faith and goodwill of its many members, which bears undoubted testimony to what the professions can achieve if they work together.”
Biggest in the world
PPS boasts over 200 000 graduate professional members, which makes it the largest multidisciplinary group of graduate professionals in the world. The member base is approximately 60% male and 40% female.
Its growth has been driven by the unmatched benefits PSS offers to its policyholders. “PPS focuses on the long-term interests of its members,” says Jackson. “Members who became policyholders only 10 years ago have been able to share in the R10.3 billion in profit and investment allocations to date. This is an offer that is unmatched in the South African professional market.”
Distribution channels
PPS regards the role of financial advisors as vital and only works via advisors, since most professionals prefer to deal with people. “We are very committed to our broker support and are very selective about which brokers we accredit,” notes Jackson. “Hence, we only have 2 500 advisers nationally and our members who wish to work through advisers are very happy with that relationship.
“We provide ongoing training and support for the PPS products and ensure that each of our advisers understand exactly why PPS is different to the rest of the market. Our marketing material is in line with this support.”
Focus on service excellence
Service levels are always an important consideration for financial advisors. “While it is impossible to ensure there are never any complaints and ‘excellent service’ is on all companies’ list of values, we strive to provide efficient service to ensure doing business with PPS is easy and painless,” says Jackson. “An independent broker firstly looks after the client, not the insurer. If it is difficult or unpleasant to deal with company A, and if company B offers a similar product, then the broker may choose to offer the product of the company with which it is easier to do business with. Because we provide support and quick responses to their concerns, our brokers see us as supporting them in their efforts to provide good service to our members. Hence, the client experience is better.”
Responding to members’ needs
However, PPS remains absolutely committed, first and foremost, to offer a service that suits the members. “Originally, some members wished to deal directly with the company but PPS historically did not facilitate this as we did not have our own representatives,” explains Jackson. “In response to the demands from some of our members, we have now built up a team to provide this service nationally. In the longer term, this simply means that we are able to service members the way they want to be serviced.”
Jackson adds that PPS is at an early stage of building this capability and plan to have approximately 400 advisors employed by PPS, as well as to expand support from independent brokers. “This is because we are expanding our product offering to members and wish to gain a greater market share in the South African graduate professional market,” he says.
Into the future
PPS remains a dynamic organisation and has launched a five-year expansion plan in 2011. “This expansion plan involves increased penetration of our chosen markets, particularly amongst black professionals; spreading the word on the advantages of the mutual model in today’s uncertain financial world; growing subsidiary companies to provide alternative sources of income which will add value to members’ Surplus Rebate Accounts; increasing PPS’ offshore presence, keeping in mind that members are covered anywhere in the world; capitalising on the Group’s state-of-the-art Information Technology platform; and, generally utilising the building blocks that are already in place to ensure that the growth is the key feature of the road ahead,” says Jackson.
“All members of PPS can be proud of the fact that they are part of the exclusive ‘Inner Circle’ and can look forward to the future, secure in the knowledge that their financial wellbeing will be protected and enhanced over the years to come.”
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