Rand Merchant Investment Holdings Limited (RMI) (formerly Rand Merchant Insurance Holdings Limited) is an investment holding company with an investment team of experienced, alternative thinking financial services specialists. In addition to its active involvement in the existing investments, RMI plans to expand, diversify and modernise its investment portfolio through opportunities across a wide spectrum of scale and life cycles of financial services businesses.


RMI’s contribution to Remgro’s headline earnings for the year under review decreased to R888 million (2015: R986 million).

The underlying investments of RMI (with percentage interest in brackets) include Discovery Holdings Limited (25%), MMI Holdings Limited (26%), OUTsurance Holdings Limited (85%) and RMB Structured Insurance Limited (76%), as well as new investments in RMI Investment Managers (100%) and Merchant Capital (25.1%). RMI announced the sale of RMB Structured Insurance, subject to regulatory approval, on 23 August 2016.

Discovery services the healthcare funding and insurance markets in South Africa, the United Kingdom, United States of America, China, Australia and Singapore. MMI was formed from the merger of Metropolitan and Momentum, focusing on long-term insurance, short-term insurance, asset management, healthcare administration and employee benefits. OUTsurance is a direct personal lines and small business short-term insurer and has recently also expanded into New Zealand under the Youi brand. RMI Investment Managers continues to build out its portfolio of affiliate asset managers as it looks to identify, partner and grow world-class asset managers, whilst Merchant Capital is launching new products and partnerships to further entrench itself into the SME segment.

RMI’s reported headline earnings for its year ended 30 June 2016 decreased by 10% to R2 934 million (2015: R3 258 million). OUTsurance, Discovery and MMI contributed R1 674 million (2015: R1 171 million), R925 million (2015: R1 362 million) and R534 million (2015: R699 million) respectively.

However, RMI believes that normalised earnings more accurately reflect operational performance, and therefore headline earnings are adjusted to take into account non-recurring items and accounting anomalies. RMI’s normalised earnings for the year under review increased by 6% to R3 348 million (2015: R3 160 million).

Discovery’s contribution to normalised earnings increased by 7% to R1 079 million (2015: R1 012 million). The increase was driven by the performance of its three established South African businesses, as well as VitalityLife in the United Kingdom. Overall earnings growth was strained by the investment of 13% of earnings generated into new initiatives. MMI’s contribution to normalised earnings decreased by 16% to R805 million (2015: R956 million) due to lower underwriting profits, muted equity investment growth and operational challenges in certain non-life businesses. The contribution of OUTsurance to normalised earnings increased by 43% to R1 664 million (2015: R1 166 million), as a result of a significant improvement in the contribution of the Youi group and good results from South African operations. Youi’s prior year results were negatively impacted by weather-related catastrophes in Australia. Gross written premiums increased by 18% to R14.8 billion, the claims ratio decreased from 55.5% to 54.4% and the cost to income ratio decreased from 28.2% to 26.2%.