Dis-Chem Pharmacies to launch new insurance business in 2025

SOUTH AFRICA—Dis-Chem Pharmacies, a prominent pharmacy group in South Africa, has announced plans to launch its own insurance business, Dis-Chem Life, in the first quarter of 2025.

This strategic move marks a significant expansion for the company, which aims to diversify its offerings beyond traditional pharmacy retail.

In August, Dis-Chem made headlines by acquiring a 50% stake in OneSpark, a financial services provider and life insurer, for R155.9 million (US$8.84 million).

While OneSpark does not hold an insurance license itself, it provides various insurance products such as funeral cover and life insurance, which Guardrisk Life Limited underwrites.

One of its key selling points is the affordability of its insurance plans, with premiums starting as low as R30 (US$1.72) per month, making insurance more accessible to a broader audience.

As part of its life insurance offerings, OneSpark will provide several essential services, including life cover, disability cover, temporary income protection, and illness cover.

Rui Morais, Dis-Chem’s CEO, emphasized that their new partnership with OneSpark will leverage innovative technology and expertise to deliver unique insurance products to the market under the Dis-Chem Life brand.

This collaboration aims to enhance customer experience and improve access to necessary insurance services.

In its statement, Dis-Chem highlighted that OneSpark’s specialized knowledge will play a crucial role in fulfilling its vision of increasing access to quality healthcare at affordable prices.

This initiative aligns with the company’s commitment to provide comprehensive health solutions catering to South Africans’ needs.

Entering the insurance market will position Dis-Chem against established players in the industry, including Discovery, Old Mutual, Outsurance, and Momentum.

These competitors recently reported positive results, despite the challenges posed by the newly signed Health Insurance Bill (NHI) and the Two-pot retirement system, which may lead to unpredictable claims from policyholders.

However, industry experts remain cautiously optimistic, especially following the country’s first interest rate cut in over four years last month, with expectations for another cut on the horizon.

In its recent performance report, Dis-Chem revealed that its headline earnings per share for the six months ending August 31 increased by 16.3%, while group revenue rose by 9.6%, totaling R19.6 billion (US$ 1.123 billion).

Considering these positive financial results, the company declared an interim dividend of 26.98 cents per share.