Makes almost 3 000 of its members millionaires
PPS, the financial services company focused exclusively on graduate professionals, has declared that its total cumulative profit-share allocation to members* was R22 billion over the last ten years. The total profit-share allocation to PPS members for the 2015 financial year alone was R2.2 billion.
PPS is the largest financial services company in South Africa that operates under the ethos of mutuality, which means that all PPS' profits are allocated to PPS members on an annual basis by way of allocations to their PPS Profit-Share Accounts**.
Over and above all the profits shared with the members, the total insured benefits paid to members during 2015 were R2.2 billion. On average, PPS paid out almost R5.2 million every day in claims to members.
Mike Jackson, CEO of PPS, says PPS members have a unique value proposition, as members qualify for a lump sum pay-out of their share of all the PPS Group's accumulated profits, upon their retirement**. "In 2015, the total number of members who are millionaires, solely from the profits allocated to their PPS Profit-Share Accounts is now approaching 3 000."
He explains that the success of the company is built upon 75 years of understanding the unique needs of the graduate professional market. "Due to the fact that PPS is based on the mutual business model, the company does not have to answer to external shareholders who may focus on a return on investment and short-term results. As PPS operates under the ethos of mutuality the company is able to remain focused on delivering on its long-term commitments and promises - to create long-term wealth for PPS members to retirement."
According to Jackson, the company experienced significant growth in 2015, with 7 050 new members joining PPS during the year - up by 39% on the previous year. In addition, the group's total own*** assets increased by 10% during the period to almost R30 billion. New risk business increased by 16% and new investment contributions to PPS Investments of R3.5 billion increased by 13%.
"These statistics point to the increasing appetite of South Africa's graduate professionals for the unique service offering and approach of PPS," says Jackson.
The increased interest in the mutuality model is mirrored globally where the total market share of mutual and cooperatives insurers has increased steadily from 23.5% in 2007 to 27.1% in 2014, according to the latest statistics from the International Cooperative and Mutual Insurance Federation (ICMIF).
According to Shaun Tarbuck, CEO of the ICMIF, the increase in the mutual market share highlights the strong benefits of this business model. "It can be argued that global markets have experienced a shift in consumers' buying behaviour when it comes to financial services and the global growth of the mutual sector could be as a result of customers reacting against the perceived culture of listed companies."
"We are extremely pleased with the performance of PPS during the last year, especially in light of challenging economic conditions. These results demonstrate the benefits of belonging to a financial services company that operates under the ethos of mutuality. As the PPS business continues to grow, our members* will also benefit by being allocated all of the profits of the company," concludes Jackson.
* PPS members with qualifying products.
** The PPS Profit-Share Account vests from age 60 onwards. Past performance is not necessarily indicative of future performance.
*** Excluding assets in unit trusts held for third parties.
PPS has more than 150 000 members who enjoy access to a comprehensive suite of financial and healthcare products that are specifically tailored to meet the needs of graduate professionals.
PPS is the largest South African company of its kind, exclusively for graduate professionals, that still embraces an ethos of mutuality, which means that it exists solely for the benefit of its members. Members receive profit allocations based on the qualifying life risk products they hold with PPS. Thus, PPS members with qualifying products could share in the profits of PPS Insurance, PPS Investments, PPS Short-Term Insurance and PPS Healthcare Administrators via annual allocations to the unique PPS Profit-Share Account. In addition, the more products members hold across these PPS businesses, the larger their percentage of earnings through the PPS Cross-Holdings Profit-Share Booster.
PPS membership provides access to the following tried, tested and trusted products and services: PPS Life Insurance, PPS Short-Term Insurance, PPS Financial Advisory, PPS Investments and Profmed Medical Scheme. Visit www.pps.co.za for more information.
PPS is a Licensed Insurer and Financial Services Provider.