Avbob declares historic R13.1bn cash bonus to its members

The Avbob Group — Avbob Insurance, Avbob Funeral Service and Avbob Industries — delivered exceptional results for the reporting year. While socioeconomic challenges and inequality persist in the country, Avbob remains encouraged by signs of political stability and an improving business outlook. 

Through its shared value business model Avbob has declared a R13.1bn cash bonus to its members. The Avbob 65Alive Cash Benefit is set to launch in January 2025. The previous Avbob Reward Account centenary bonus will be replaced by the new cash benefit.

As part of Africa’s largest mutual society, members of Avbob are entitled to share in the profits of the business. These profits are shared as member benefits which are provided over and above the contractual policy benefits. Profit allocations are made from time to time at the discretion of the directors. 

At Avbob’s 73rd AGM held in Centurion, Gauteng, board chairman Jannie Venter described the substantial bonus declaration as a demonstration of the importance of value creation for society. 

“A shared national commitment to sound economic policy support helps to accelerate and drive sustainable benefit to society. Our shared value model, which fosters inclusivity and innovation, benefits all members and is a testament to the strong foundation of our mutual society,” said Venter.

This historic financial declaration is underpinned by the group’s mission to provide meaningful and tangible support to its members. With the new declaration — the Avbob 65Alive Cash Benefit — members are eligible for payment on request on or after the first policy anniversary following the main insured person’s 65th birthday, subject to their policy having been active for a minimum of 10 years.

Growth and strategy

Avbob CEO Carl van der Riet said despite prevailing economic pressures, the growth strategies of the business were gaining traction, strengthening its market position. He credited this to the resilience of the Avbob business and its continued innovation.

“Avbob is pleased to declare this substantial bonus to its members, which affirms our commitment to sharing the society’s success. Leveraging our mutual status allows us to return value to our members, through our combined insurance and funeral service offerings,” he said.

Van der Riet said the core focus of the business remained sustainable growth and strategic differentiation. Avbob is also strengthening its stakeholder engagement by expanding its digital channels and introducing high-impact self-service platforms.

The member-centric approach of the business continues to shape Avbob’s offerings. The newly launched Avbob Member Rewards programme has seen unprecedented interest from Avbob members and has generated renewed and positive brand energy. With over 300,000 members currently benefitting from the programme, it stands as a testament to Avbob’s ongoing commitment to value creation and sharing.

Avbob achieving a Level 1 B-BBEE rating in the year under review highlights its commitment to transformation. For the business, the collective benefit of all communities forms a key part of its operations. And with over 2.7-million policyholders and 9-million individual lives assured, Avbob aims to continue to uphold its legacy as a household brand to millions of South Africans across the country.

2023/2024 financial highlights

In the financial year ended June 30 2024, Avbob achieved the following:

• The group paid out R2.9bn in policy benefits.
• Premium income increased by 9.0% to R6.8bn.
• Net New Business sales increased by 30.2% to R1.3bn.
• Increased the national footprint of funeral service, insurance and client service to a total of 380 offices.
• Members received R498.9m in free funeral benefits provided by Avbob Funeral Service.
• Avbob donated its 70th container library and 500 trolley libraries to underserved schools, as part of its investment in literacy and education.
• Won the Best Funeral Service category in the 2024 Best of Mossel Bay Readers’ Choice Awards.
• Recognised at the 2024 PMR.africa Gauteng Provincial Survey Business Excellence Awards.
• Won the Funeral Services category in Die Burger newspaper’s 2024 Readers’ Choice Awards.
• Named Coolest Insurance Brand at the 2024 Sunday Times GenX Awards.

This article was sponsored by Avbob.