In 2007, ACE Insurance will continue its main focus on corporate and commercial business, offering insurance coverage, underwriting services and risk management. In line with international expertise, ACE will concentrate on risk solutions to the corporate sector, particularly those with pan-African and global ambitions.
 
Besides offering core competencies, such as property, technical lines, project cargo, large general liability, export products liability, professional indemnity and directors & officers liability coverage and accident and health products, ACE will also develop business with affinity partners, such as banks and other financial institutions, thereby reaching the broader market.

In the longer term, the South African office will serve as a regional hub for our entry into the broader African market.

As regards the current state of the domestic insurance market, the underwriting cycle has softened considerably over the last two years and is reflective of both global market conditions and sustained period of good growth and profitability of the local market.

There does appear to be a move by most companies underwriting personal lines business to increase rates, especially on motor insurance due to deteriorating loss ratios caused by a number of factors such as increased congestion on roads, vehicle hijackings and poor standards of driving. The corporate and commercial sector has seen competitive pressures on rating in 2005 and 2006 but we believe these pressures will stabilize somewhat in 2007.

This is a cyclical business and one has to be prepared to ride out market downturns. The timing of ACE’s entry to the South African market in 2006 was not influenced by underwriting cycles however, and it has already been demonstrated that we do not intend to undercut the market as this is not sustainable.

We continue to be bullish about the long term prospects of both the economy and the insurance industry here in South Africa.

In 2007 ACE will also build on the core team of top quality professionals we’ve established in 2006. The A rating that we’ve been awarded as a start-up company, of which we’re really proud, speaks for itself and I believe will be factor in attracting both staff and clients.

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