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Tuesday, 12 March 2024 13:39

Old Mutual tenders apology as it faces reputational damage after X storm.

By Lehlohonolo Lehana.

Old Mutual SA has tendered an apology to the South African public, in the midst of a social media storm as outraged users call for consumers to move their policies to alternate service providers after it declined to pay out a pension policy.

Last week, an X user named Sebabatso Molefi posted that a court order had been granted to enforce the payout of her mother's pension and the firm had not complied.

The post has been viewed 1.3-million times, with many social media users sharing similar stories of non-payment or lower-than-expected savings product payouts.

However, Old Mutual told Fullview that it was "committed to finding a solution, and we would like to apologise for the way we have managed the outcry on social media".

Its statement read: "Our reluctance to engage and debate on X stems from the complexities of the case and our desire and duty to protect the personal information of the individuals concerned."

"We need to ensure that our compliance with the court order is consistent with our obligation to comply with the pension funds law and tax law. Our intention is to ensure the parties are paid.

"We are investigating ways to solve the problem and will be meeting with the family this week. "The meeting is set for Tuesday.

Despite the assurance given by Old Mutual SA to resolving the matter, other customers have started sharing screenshots of their cancelled policies.

Meanwhile Old Mutual said "exceptional growth" in new business drove profit at Africa's biggest insurer by assets as much as 45% higher last year.

Profit after tax likely increased to as much as R7.59 billion in the 12 months ended December 31 from R5.23 billion a year earlier, the company said in a voluntary trading statement Tuesday.

Higher interest rates and a recovery in equity markets buoyed investment returns, it said.

Old Mutual recorded growth in results from operations "due to strong operational performance underpinned by exceptional growth in new business and value of new business as we continue to gain market share across our segments," it said.

The company excludes profit from its business in Zimbabwe because hyperinflation in that country triggers earnings volatility. The insurer will publish its results on March 27.