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At the end of each year policyholders’ PPS Profit-Share Account, comprising the Apportionment Accounts and
the Special Benefit Accounts, are allocated a share of the profit or loss, net of movements in insurance policy
liabilities earned over that year. The PPS Profit-Share Account accumulates from year to year until a policyholder
reaches retirement age.
On retirement, death or exit, policyholders can access an amount based on the balance
accumulated in their PPS Profit-Share Account at that time. This is over and above the cover enjoyed by them
as policyholders. For retiring members, in particular, this represents a valuable pool of retirement assets.
The PPS Profit-Share Account represents an allocation of surplus and investment returns only. This account does
not belong to the policyholders, or their nominated beneficiaries (or become a ‘vested benefit’) until retirement,
death or exit. The total assets backing the PPS Profit-Share Account belong to PPS Insurance or PPS Namibia
at all times.
The investment returns or losses and net operating income allocated each year may be positive or negative,
depending on investment return as well as the operating experience of PPS Insurance and/or PPS Namibia.
Therefore, the PPS Profit-Share Account may increase or decrease in any year. Possible variations in the PPS
Profit-Share Account are set out in the accounting policies and notes to these financial statements. No guarantees
can be given by PPS Insurance or PPS Namibia that the allocations of operating results or investment returns will
always be positive, or that the PPS Profit-Share Account will not reduce in any year.
The net operating income is allocated with reference to the qualifying products a policyholder holds and in
accordance with the allocation rules for the specific products held. The investment returns are allocated in
proportion to the size of the policyholders’ PPS Profit-Share Account.
For all policyholders from age 60 to 65, the full balance of the PPS Profit-Share Account is available through the
Vested Profit-Share Account to such policyholders on termination of cover or resignation, subject to the vesting
rules as contained in the policy document, and it is paid to the policyholders’ beneficiaries or their estates on
death. For all policyholders aged 66 or older, the full balance of the PPS Profit-Share Account is available through
the Vested Profit-Share Account to such policyholders, and it is paid to the policyholders’ beneficiaries or their
estates on death. On surrender of a policy prior to the age of 60, policyholders are entitled to receive a lump sum
termination payment determined as a proportion of the PPS Profit-Share Account at the time.
TOTAL ALLOCATIONS TO PPS PROFIT-SHARE ACCOUNTS
2018
2017
PPS Insurance
R'000
R'000
Allocation (from) / to Special Benefit Accounts
(745 019)
2 261 415
Allocation to Apportionment Accounts
1 372 696
1 304 885
Total allocations to PPS Profit-Share Accounts
627 677
3 566 300
2018
2017
PPS Namibia
N$'000 N$'000
Allocation (from) / to Special Benefit Accounts
(76 098)
99 586
Allocation to Apportionment Accounts
82 994
69 085
Total allocations to PPS Profit-Share Accounts
6 896
168 671
INVESTMENT RETURNS
AND PROFIT ALLOCATION
TO POLICYHOLDERS’ PPS
PROFIT-SHARE ACCOUNT
for the year ended 31 December 2018