The state, not white monopoly capital, is to blame for SA’s insurance oligopoly
The regulatory and legal environment favours large-scale consolidation of insurers, making transformation and future inclusive growth highly unlikely
The South African insurance industry is an oligopoly: a market structure similar to a monopoly, but in which a small number of companies have the majority of market share. This is not the creation of faceless "white monopoly capital". It is an entirely predictable response to the intrusive and extensive overreach of muddled government agencies in their quest for control of the industry. Through its regulatory exuberance, the state has curtailed industry growth, and thus capital and job creation. If the industry is to grow at all in the future, it needs to welcome and enable new entrants in radically new ways. However, the current path that we are on, especially the impending "twin peaks" changes to legislation and the unproven Retail Distribution Review, will further limit new entrants and make it all but impossible for existing insurers to transform and diversify. Instead, one should expect more consolidation, greater exclusivity and more oligopoly. Contrary to the popular politica...
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