2020 INTEGRATED REPORT

result of the lockdown, is the economic impact on our members’ ability to pay their insurance premiums. We are constantly looking at different ways to support those affected in this way. We anticipate an even bigger move to more self- service in our professional member base and shall continue towork on functionality, designed to improve efficiency and the overall member experience. Rapid technological developments will be potentially disruptive, but while they may represent a challenge for the business, they will also open up many opportunities. PPS HEALTH PROFESSIONS INDEMNITY A product specific to PPS Short-Term Insurance is PPS Health Professions Indemnity. Designed for health professionals registered with the Health Professions Council of South Africa and working in clinical practice, it provides the security health professionals need to be able to focus on their clinical practice, safe in the knowledge that their indemnity needs are being met by a brand they know and trust. The product has been well received by medical professionals, with uptake doubling in 2020. The most significant competitor offering indemnity insurance is the London-based Medical Protection Society (MPS), which has traditionally served the South African market from its offices in the UK. The PPS offering is, however, different to the MPS offering in many important ways. Firstly, as we are locally based, we have a better understanding of local issues and conditions. Our service is also provided directly to members, rather than through a call centre. Another unique feature is our risk-adjusted model. We look at the risk profile of each individual and/or practice in order to determine the cost of indemnity insurance in that particular case. We do not, for instance, set standard rates for specialists regardless of their geographic location and case load. We assess practices in big cities, where case loads are higher, differently to those located in regional towns, where case loads are usually lower. The cost of insurance is determined accordingly. In addition, premiums are adjusted according to the risk appetite of the individual member. If practitioners manage their risk well and have a lower probability of claiming, they are able to make use of a voluntary claims deductible to lower the absolute cost of insurance. Our response to the COVID-19 crisis was immediate. PPS Short-Term Insurance was the first provider to offer assistance to medical professionals who hold the PPS Health Professions Indemnity product and were affected by the pandemic. For example, we helped to ease cash flow by restructuring payment agreements wherever needed. We also reassessed the clinical risk profiles of members unable to work due to lockdown restrictions and offered reduced premiums for those with lower risk profiles. PROSPECTS Despite the constrained economic environment, the business’s prospects for 2021 are good. There is, for instance, a clear opportunity to build on our value proposition and also to market the benefits of the PPS Profit-Share Cross-Holdings Booster. There is also the ongoing opportunity to partner with professional associations in order to obtain their endorsement and to provide customised solutions for their members. PROFESSIONAL PROVIDENT SOCIETY SHORT-TERM INSURANCE COMPANY LIMITED (CONTINUED) 64 | PPS INTEGRATED REPORT 2020