UMAs: The agile experts powering the future of insurance

Underwriting management agencies have quietly become one of the insurance industry’s best-kept secrets, but their impact is far from hidden.

Underwriting management agencies (UMAs) have existed in the South African insurance market for over 40 years. UMAs are specialist insurance businesses that operate with delegated authority from licensed insurers. Through this delegated authority, they are empowered to underwrite risks, issue policies, collect premiums and manage claims, essentially fulfilling the role of a small insurance company without the requirement for their own capital. Over 80 UMAs operate in the South African market and contribute more than 20 per cent to the short-term insurance market’s gross written premium.

Lireas Holdings, a subsidiary of Hannover Reinsurance Group Africa, is a corporate venture capital investment company that has partnered with entrepreneurs and invested in more than 40 specialist UMAs since the late 1980s. More recently, Lireas invested in “new age”, tech-driven insurance businesses sometimes referred to as Insurtechs, such as Pineapple, Inqaku and Different Technology. In the same way that UMAs are increasing in stature and importance in global markets and gaining the attention of insurers, investors and regulators, we expect the same trend and investment activity in the South African market.