ABSTRACT
This research investigates the impact of improved (and improving) mortality experience in South Africa
as a result of the increased (and increasing) access to antiretroviral treatment on South African life
assurers, the entry-level insurance market and the wider South African economy. The research focuses
on various potential impacts on the entry-level insurance market, including new business profitability,
product development and pricing, market penetration and the potential for increased savings. This
research has been done with the assistance of four of the main South African life offices and also draws
on the new THEMBISA AIDS model on which a working paper has been produced. The research is
based on the THEMBISA model in order to investigate the potential impact of alternative mortality
scenarios on typical entry-level products within the industry where the scenarios have been based on
actual current and proposed antiretroviral roll-out strategies by the Department of Health. Potential
improvements to profitability, premium reductions, benefit enhancements and cashback benefits are
quantified using a profit test model for entry-level market products.