On 14th May 2021, a new insurance company, Alexander Forbes Insurance Company (AFN Insurance), was established with a base in Musi Lagos. This new company will be providing mainly life and health insurance products to the citizens of Namibian. The formation of this new company is seen as a direct challenge to the main player in the field of life insurance industry viz., IFRS. The decision was seen as a move by the MSP to protect itself from the competition posed by the new insurer. MSP is a leading life insurance company in Namibian.
According to my understanding of the matter, Mr. Alex Mafioso, the founder and CEO of MSTI, received a notice from his company directors that the MSP would be making a submission in the Namibian Share Exchange, on behalf of himself and the company. The Namibian Share Exchange is a market place in south Africa, where shares are listed and traded, for small businesses. However, this does not mean that it will be a direct competitor of the MSP. The reason being that the MSP already has a large number of shareholders who are controlling a large amount of voting power. Hence, any move made by the MSP in this regard may trigger a response from the shareholders.
What was decided at the AGM was that the company would be using the name “ALEXander FORBES” as the brand for its life and health insurance products. This was done in order to ensure that there is a binding agreement between the corporation and the CEO. The company intends to use the term “client Centricity” when referring to its customers. This is in accordance with the South African Human Rights Association Code of Conduct, which states that any company must maintain a “client-centric perspective”.
As regards future name change, it is understood that clients will continue to have access to the same company and they will continue to transact business with the same agents. It is also understood that clients will be able to transact business using any other company that the CEO and the company have signed up with. This means that the clients will still have access to the same agents and the same products offered by the company. In short, it means that the clients will still be bound by a binding contract with the company even after a future name change. However, it is understood that the client will be entitled to a break in term of reduced premiums for as long as the new company remains financially sound.
Regarding diversified product offering, we understand that this can be used to offer an attractive package for clients. For example, a large group of individuals may opt to purchase a “group” of Alexander Hills insurance policies over a short period of time, for a price that is lower than what they would pay if they had purchased those policies individually. Such a policy would be “grouped” under the “group” category. An average of five clients could be grouped in this category. This would allow for a higher premium to be paid, but the risk of having the same agent represent more than five clients in a short-term instance would be considerably reduced, thereby allowing for more consistent representation for all five clients.
We believe that Alexander Hills Insurance Co is taking steps in the right direction by focusing their attention on diversified products and services to meet the needs of a broader customer base. In doing so, they are not sacrificing the clients they currently serve. In fact, by diversifying into different categories, the number of clients represented by an agent increases. By engaging in these efforts, a business can have a more robust, well-rounded customer base at little additional cost. As we stated at the start of this article, this was a brief review of our impressions of the company and our opinions on its ability to serve our niche insurance needs. If you have additional information or would like to share your thoughts on the matter, please feel free to contact us via email or via the website listed below.