During a Moneyweb radio interview Anton Gildenhuys, executive head of Sanlam‘s life-insurance and savings products, spoke about the group’s most recent financial results and a new partnership with GoTyme Bank.
According to Gildenhuys, Sanlam said its results showed strength in the life-insurance and savings divisions, with premium income and investment returns supporting a solid profit figure. The executive did not disclose the exact profit amount, noting only that the outcome met the group’s internal targets.
The partnership with GoTyme Bank, a digital-bank that targets lower-income consumers, will see Sanlam’s life-insurance and savings products offered through GoTyme’s online platform. Gildenhuys described the deal as a way to reach customers who prefer banking on their phones rather than visiting a branch.
Why the partnership matters
For Sanlam, the arrangement provides a low-cost distribution channel that could broaden its customer base beyond traditional agents. For GoTyme, adding insurance and savings options enhances its product suite and may improve customer retention. The collaboration reflects a broader trend in South Africa where insurers are seeking digital partners to offset the slowdown in branch-based sales.
SME owners reading this should note that the partnership does not directly affect small-business financing, but the increased availability of affordable life-insurance could be relevant for protecting key personnel or securing business loans.
The South African insurance regulator, the Financial Sector Conduct Authority, has been encouraging digital distribution to improve financial inclusion. While the regulator has not commented on this specific deal, the partnership aligns with that policy direction.
Gildenhuys concluded by saying the collaboration is an early step and that Sanlam will monitor its performance before considering further digital alliances.
The distribution problem that shapes life insurance
Selling a life-insurance policy has always cost more than selling almost anything else of comparable value, and the reason is that nobody wakes up wanting one. The product is bought rarely, understood poorly, and pays out at a moment the buyer would prefer not to contemplate, which is why the industry has historically relied on agents and brokers who sit with a customer and work through it.
That model works and it is expensive. An agent’s time has to be paid for out of the premium, usually through commission loaded into the early years of the policy, and the arithmetic only holds if the policy is large enough to carry the cost. Below a certain premium the sale costs more than it earns, which is the structural reason lower-income customers have historically been offered either nothing at all or a product stripped down to the point of being worth very little.
Why a banking app changes that arithmetic
Distribution through a digital bank attacks the cost side rather than the product side. The customer has already been identified and verified by the bank, which removes a large part of what an agent would otherwise do. The bank knows what the customer earns and when, which makes it possible to collect a premium as a scheduled deduction rather than chasing a debit order that bounces. And the customer arrives at the offer already inside an application they open for other reasons.
The effect is to lower the premium at which a policy becomes viable, which is what makes a partnership of this kind a financial-inclusion story rather than only a distribution deal. It is also why regulators tend to encourage the arrangement rather than merely permit it.
The limitation sits on the other side of the same efficiency. A product simple enough to sell without advice is a product the customer chooses without advice, and the gap between what a policy covers and what a buyer assumed it covered is where complaints in this part of the market usually originate. That risk is well understood in the industry, and it is the thing an arrangement like this has to manage from the start rather than after the first wave of claims.
What a business owner should take from it
For an owner-managed business the relevant application is not the retail product but the principle underneath it. A small firm typically depends on one or two people whose absence would stop it trading, and cover on those people is what a lender often wants to see before extending credit against the business rather than against a house. Cheaper and simpler life cover lowers the cost of arranging that, which matters more to a small business than it does to a large one.
