South African insurer Old Mutual paid out R2.7 billion worth of Covid-19 related death claims in the first quarter, it said on Friday, leaving about R1.3 billion in reserves set aside to help it manage the pandemic.
The numbers reflect the impact of a severe second wave of infections, but South Africa’s curbs are at their lowest level as it once again faces a spurt in cases, fanning fears of a third wave as the colder months of winter approach.
“We continue to closely monitor our claims experience as future waves and their impacts remain uncertain,” Old Mutual said in a trading update.
But the firm was confident its balance sheet and liquidity position could withstand future pandemic impacts, it added.
The update did not give an earnings forecast, but the firm said its measure of operating profit was up 48% in the three months to March 31, at R1.8 billion.
This was due to factors such as benefits from a stronger performance in the local equity market, fewer bad debts and cost control, it said, adding that it was on track to deliver its cost-saving target of 750 million by the end of 2022.