Construction World October 2016

CONSTRUCTION WORLD

OCTOBER

2016

The government’s launch of 101 ‘cata-

lytic projects’ in terms of its Breaking

New Ground housing policy are likely

to reduce any imminent retrenchments from

the concrete products sector, PMSA MDWalter

Ebeling comments.

Current housing projects underway are

too small and dispersed to make a significant

impact, whereas the latest tranche of 101

projects, of which 94 are ready for implemen-

tation, range across all nine provinces, with a

combined value of over R300-billion. They are

expected to generate 20 000 additional jobs

in the construction and ancillary industries.

This transformation will fuel increased

infrastructure investment that creates

insurance opportunities as new

developments are going to need insurance

during the construction phase and once they

are operational.

Across the rest of sub-Saharan Africa, Old

Mutual has a market-leading footprint with

strong insurance businesses. However, like

Mutual & Federal, increased risk bearing capacity

and a broader underwriting appetite would

help the company to expand its growth in

these markets.

Generally speaking, large and complex

‘specialty insurance’ is still mainly insured by

international reinsurance firms or in global

insurance markets such as London, with small

local risk participation.

Therefore, Old Mutual Emerging Markets

(which includes Mutual & Federal) have intro-

duced Old Mutual Specialty Insurance. This is

to increase its relevance to corporates, public

bodies, investment companies or consortia that

have more complex risk-management require-

ments. For example, major industrial firms,

property investment companies, construction

and energy projects or political risks that threaten

trade or investments.

Boldly capitalising on

opportunity

Demand for large ‘specialty’ insurance, is

expected to grow beyond USD10-billion in

premiums in the near future. This demand will

be driven by risks such as commercial property,

construction, energy, terrorism, kidnapping and

ransom threats and political risk.

Mutual & Federal is the second largest

corporate insurer in South Africa, with clients

including a number of the best-known and

largest companies, as well as leading positions

in emerging sectors such as renewable energy.

For Old Mutual emerging markets to realise

its ambition of building a financial services

champion in Africa, it makes sense to plug this

gap. This is fitting especially as the company will

be funding many of the large projects through

subsidiaries such as Nedbank, the fund manage-

ment business and its own insurance funds.

Old Mutual specialty insurance

Old Mutual specialty insurance offers custom-

ised insurance solutions for large and complex

clients, as well as for risks in nine product areas:

commercial property, energy, construction,

political risk and trade credit; mining, kidnap

and ransom, terrorism, cargo, transit and delay

in start-up and general aviation.

These solutions will be delivered through

established Old Mutual insurance businesses

in sub-Saharan Africa and under the existing

brands, including Mutual & Federal, UAP Old

Mutual and Old Mutual Nigeria. This will provide

MEGA PROJECTS BOOST CONCRETE

PRODUCTS SECTOR

New mega housing projects announced by the government stand

to boost the concrete products manufacturing industry, which has

seen many cement suppliers drop their prices due to decreased

demand and excess cement supply.

Having celebrated its 40

anniversary with

the unveiling of a new range of products and

technology at Totally Concrete 2016, PMSA

boasts a comprehensive range of equipment

that can be used to manufacture every one of

these products used in housing developments.

“The equipment supplied by PMSA comes

with comprehensive training, commissioning

and support. This means the customer has

confidenceoffullback-up.Weare locally-based,

but with countrywide support, and three

branches in Johannesburg, Durban and Cape

Town,” Ebeling highlights.

PMSA celebrates its 40

anniversary this year with new

range products and technology.

TEAMING UP TO CONQUER COMPLEX RISK

Stylish shopping malls, modern office blocks and housing

developments are all evidence of a dramatic change in the way people

across sub-Saharan Africa live, work and think about their future. With

a young and growing population, this transformation is predicted to

accelerate over the next 10 to 15 years.

the businesses with a broader product range

and significant risk-bearing capacity, as they

will be able to underwrite up to an additional

USD250-million sum.

This enhanced customer value proposition

will increase choice for insurance brokers, buyers

and investors, and enable more specialty insur-

ance business to be retained in Africa.

Sam Boyd, head of corporate and niche

at Mutual & Federal explains: “We are a strong

competitor in South Africa and are excited that

we will be able to market Old Mutual Specialty

Insurance solutions under the Mutual & Federal

brand. This will allow us to underwrite a broader

Sam Boyd, head of corporate and niche at

Mutual & Federal.

portfolio of clients and be able to increase our

participation in important and growing segments

including the wholesale African business being

placed into the Johannesburg market.”

“With a stagnant growth

rate, these housing mega

projects will generate much

needed demand side stim-

ulus in the local economy

which, in turn, drives supply

from the private sector

and new investment into

capital equipment,” Ebeling

points out.

Concrete is used in all

aspects of a housing devel-

opment project, from roof

tiles to bricks, blocks, paving

for roads, concrete pipe-

work for stormwater and

sewage, road kerbstones

and drainage, foundations

and concrete floor slabs.