Delivery Trucks Prime Target for Hijackers as Santam Reports 128% Surge in High-Value Vehicle Theft Claims

South Africa’s leading short-term insurer, Santam, has reported a staggering 128% increase in high-value vehicle theft claims for 2024, with delivery trucks emerging as the prime target for hijackers. This alarming trend underscores the growing sophistication of criminal syndicates and highlights the challenges faced by the insurance and logistics industries.

The findings were revealed in Santam’s financial results for the year ended 31 December 2024. While the insurer delivered a strong overall performance, the sharp rise in vehicle theft claims, particularly for commercial delivery trucks, has raised significant concerns.

A Growing Trend in Vehicle Hijackings

Using 2019 as a base year, Santam has observed an unsustainable increase in claims for high-value vehicles, especially delivery trucks. In response, the insurer implemented corrective measures in 2023, including requiring clients to install additional vehicle trackers and use Faraday pouches to prevent the cloning of keyless access signals. Despite these efforts, the problem has persisted, prompting further increases in insurance premiums to reflect the heightened risks.

The Road Freight Association (RFA) and security groups like Fidelity have also flagged the rising number of attacks on delivery vehicles. These crimes are often premeditated, with criminals using tactics such as placing fake delivery orders to ambush drivers. In more severe cases, syndicates employ ‘mafia-style’ attacks to hijack road freight vehicles, highlighting the growing sophistication of these operations.

Santam’s Strong Financial Performance

Despite the challenging operating environment, Santam reported a robust financial performance for 2024. The group’s FutureFit 2030 strategy and underwriting actions over the past two years have paid off, with double-digit premium growth exceeding long-term targets.

Key financial highlights include:

• A 12% increase in group insurance revenue, rising from R46.8 billion to R52.3 billion.
• Basic earnings per share up 13% to 3,356 cents.
• Headline earnings per share surged by 51% to 3,477 cents.
• An ordinary dividend increase of 9% to 985 cents per share.

However, the insurer faced significant challenges in its motor and property insurance classes. Motor repair costs rose faster than headline CPI, while extreme weather events led to increased property claims. Santam reported weather-related catastrophe claims of R748 million, consistent with 2023 levels.

Tackling the Challenges

To address the rising claims, Santam has implemented several underwriting actions, including segmented premium increases and higher excess amounts for selected risks. The group is also working with stakeholders to contain costs across the motor value chain and mitigate the impact of extreme weather events.

High inflation, interest rates, and unemployment have further compounded the challenges, reducing consumer disposable income and suppressing growth in new vehicle sales. These factors have made insurance premiums less affordable for many South Africans, impacting the industry’s growth prospects.

Santam remains committed to its FutureFit 2030 strategy, which aims to strengthen its market position and improve profitability. While the insurer is optimistic about its long-term prospects, it acknowledges the need for continued vigilance in addressing the risks posed by vehicle theft and extreme weather events.

For businesses operating in the logistics and transport sectors, the rise in hijackings underscores the importance of investing in advanced security measures and working closely with insurers to mitigate risks. As criminal syndicates become more sophisticated, collaboration between industry players, law enforcement, and insurers will be crucial to combating this growing threat.

while Santam’s financial performance highlights its resilience, the surge in high-value vehicle theft claims serves as a stark reminder of the challenges facing South Africa’s insurance and logistics industries. By staying proactive and adaptive, stakeholders can work together to create a safer and more secure environment for all.

Source: Business Tech

Follow Joburg ETC on Facebook, Twitter , TikTok and Instagram

For more News in Johannesburg, visit joburgetc.com