Our opinion on the current state of OUT

OUTsurance (OUT) assumed the listing of Rand Merchant Insurance (RMI) effective from 7th December 2022. Following this transition, RMI divested its interests in Discovery (DSY) and Momentum (MTM), and divested its 30% stake in Hastings Plc for R14.6 billion. By March 2023, the insurance business of OUTsurance remained as the sole focus of RMI.

In its financial results for the six months ending 31st December 2023, OUTsurance reported a 22.5% increase in gross written premiums and a notable 38.8% rise in the annualised new business premium. The company attributed the increase in the claims ratio, from 54.4% to 59.1%, to R678 million in higher natural perils claims incurred by Youi. However, it noted that Youi's working loss ratio, excluding natural perils, improved from 51.9% to 50.8%, indicating that the deterioration was entirely accounted for by the higher natural perils.

From a technical standpoint, while currently at a cycle low, OUTsurance's share price has been steadily climbing since the unbundling, and the outlook suggests continued positive performance ahead.