South Africa life insurance sector stays financially strong

South African life insurers paid claims and benefits worth ZAR626bn ($38.24bn) in 2025, which included life, disability, critical illness (CI) and income protection policies, as well as underwritten pension fund benefits, annuity payments to pensioners and endowment policy benefits.

The figures are from a statement by the Association for Savings and Investment South Africa (ASISA), and relate to  life insurers that are members of the association.

Members also managed 46.2m risk and savings policies on behalf of policyholders in December 2025. The number of in-force policies increased by 4% over the 12 months from 44.4m at the end of December 2024.

ASISA Life and Risk Board Committee Member Gareth Friedlander mentioned in the statement that the long-term insurance industry remains financially strong.

Higher take-up rates

Life and health policies

Figures showed that in 2025, consumers bought 10.8m new individual recurring premium policies, of which 6.2m were funeral policies, 1.9m were credit life policies, and 2.7m were life, disability, CI and income protection policies.

This represents a 3.8% increase in new recurring premium business from 2024, when 10.4m new policies were taken out.

Mr Friedlander also highlighted that policy lapses were on the rise again after declining for three consecutive years. In 2025, some 8.7m risk policies lapsed, compared with 8.2m in 2024.

“Policy lapses are always concerning. Unless lapsed policies are replaced with new policies, lapses widen South Africa’s sizeable insurance gap, leaving more families financially vulnerable should their breadwinner die or become disabled,” he added.

The 2025 ASISA Life and Disability Insurance Gap Study, published in 2025, showed that South Africa’s 16.1m formally employed income earners collectively had enough life and disability insurance cover at the end of December 2024 to provide only 39% of the income needed by their families in the event of death or disability.

Savings policies

The take-up of new individual recurring premium savings policies (endowments and retirement annuities) slowed by 5.5% from 568,586 in 2024 to 537,203 in 2025.

On the upside, Mr Friedlander pointed out that the declining trend in policy surrenders continued in 2025.

Policyholders surrendered 458,848 recurring premium savings policies in 2025, compared to 521,736 in 2024.

New single premium savings policies, on the other hand, increased by 5.1% from 207,744 in 2024 to 218,276 in 2025.

SCR

Statistics in ASISA’s statement showed that collectively, life insurers held ZAR380.5bn in reserves at the end of December 2025, against the Prudential Authority’s Solvency Capital Requirement (SCR) of ZAR222.9bn, resulting in an average SCR cover ratio of 1.71.

Life insurers' assets exceed ZAR5tn for the first time

According to the statement, buoyed by strong stock market performance, assets managed by South Africa’s long-term insurance industry hit ZAR5.2tn in 2025.

This marks the first time South Africa’s long-term insurance industry exceeded ZAR5tn.