Nimbus Direct Insurance — Appendices

Supporting appendices underpinning the Nimbus Direct Insurance business plan — the glossary of terms, the consolidated key-assumptions schedule, the management-team profiles and the detailed reinsurance programme.

Section 18 · Business Plan

Appendices

Appendix A — Glossary of Terms

Definitions of technical, regulatory, and financial terms used
throughout this business plan.

Term	Definition
Acquisition cost ratio	Costs of acquiring new policies (commissions, marketing attributable to new business) expressed as a percentage of gross written premium.
Combined ratio	Sum of the loss ratio and expense ratio. A combined ratio below 100% indicates underwriting profitability.
DAC	Deferred Acquisition Costs. The portion of acquisition expenses related to unearned premium, deferred and amortised over the life of the policy.
EPS	Earnings per share. Net profit divided by the weighted average number of shares in issue during the period.
FICA	Financial Intelligence Centre Act, 2001. South African anti-money-laundering and counter-terrorism financing legislation.
FSCA	Financial Sector Conduct Authority. South African market conduct regulator for financial services.
GWP	Gross Written Premium. The total premium written before deducting reinsurance ceded.
IBNR	Incurred But Not Reported. A reserve for claims that have occurred but have not yet been reported to the insurer.
IFRS 17	International Financial Reporting Standard 17 (Insurance Contracts). Effective for periods commencing on or after 1 January 2023.
LTV	Lifetime Value. The expected total contribution margin from a customer over the duration of the customer relationship.
MCR	Minimum Capital Requirement. The regulatory minimum capital level below which the regulator may withdraw the insurance licence.
MOIC	Multiple of Invested Capital. The ratio of total distributions received to total invested capital.
NBFIRA	Non-Bank Financial Institutions Regulatory Authority. The regulator of the Botswana insurance industry.
NEP	Net Earned Premium. Premium earned during the period, net of reinsurance ceded.
OCR	Outstanding Claims Reserve. A reserve held for claims reported but not yet settled.
ORSA	Own Risk and Solvency Assessment. A self-assessment exercise required of insurers under SAM, covering all material risks.
PA	Prudential Authority. The prudential regulator of South African insurers, operating under the South African Reserve Bank.
POPIA	Protection of Personal Information Act, 2013. South African data protection legislation.
Quota share	A form of proportional reinsurance in which the insurer cedes a fixed percentage of premium and claims to the reinsurer.
ROE	Return on Equity. Net profit after tax divided by average shareholders’ equity during the period.
SAM	Solvency Assessment and Management. The risk-based capital regime applicable to South African insurers, effective from 1 January 2018.
SCR	Solvency Capital Requirement. The amount of capital an insurer is required to hold under SAM Pillar I.
UPR	Unearned Premium Reserve. The portion of premium received that relates to unexpired periods of insurance cover.

Appendix B — Consolidated Key Assumptions Schedule

This appendix consolidates the principal assumptions underpinning the
financial projections presented in Section 14. Detailed driver-level
inputs are available in the supporting Excel financial model upon
request, subject to confidentiality undertakings.

Macro-economic Assumptions

Variable	Y1	Y2	Y3	Y4	Y5
South Africa real GDP growth	1.7%	1.9%	2.1%	2.2%	2.2%
South Africa CPI (period avg.)	5.0%	4.8%	4.6%	4.5%	4.5%
SARB repo rate (period avg.)	7.75%	7.50%	7.25%	7.25%	7.25%
10-year government bond yield	10.2%	9.9%	9.7%	9.5%	9.4%
ZAR/USD (period avg.)	18.20	18.50	18.80	19.10	19.40
Botswana real GDP growth	n/a	n/a	4.0%	4.2%	4.3%
Botswana inflation	n/a	n/a	3.8%	4.0%	4.0%

Operating Assumptions

Variable	Y1	Y2	Y3	Y4	Y5
Customer count, end of period (000s)	80	220	500	900	1,400
Average premium per policy (ZAR)	3,125	3,273	3,600	3,444	3,214
Customer acquisition cost (ZAR)	650	595	545	500	470
LTV / CAC ratio	6.46x	7.06x	7.71x	8.40x	8.94x
Channel mix — digital direct	55%	62%	68%	72%	74%
Channel mix — comparison sites	30%	27%	23%	20%	18%
Channel mix — partnerships	12%	9%	7%	6%	6%
Channel mix — referral	3%	2%	2%	2%	2%
Net Promoter Score	55	60	63	65	67
Mobile share of transactions	65%	72%	78%	82%	84%

Appendix C — Management Team Profiles

The Nimbus management team comprises six senior executives drawn from
leading South African and international insurance, technology, and
financial services organisations. Individual profiles will be confirmed
at first close and included in the formal offering memorandum.
Indicative role descriptions and target backgrounds are summarised
below.

Role	Profile
Chief Executive Officer	Senior insurance executive with 15+ years’ experience including direct insurance P&L leadership at a top-5 South African insurer; track record of building scale customer franchises; deep regulatory relationships.
Chief Financial Officer	Qualified Chartered Accountant (CA SA) with 12+ years’ financial leadership in financial services; insurance reporting and IFRS 17 implementation experience; prior listed-entity CFO or financial controller exposure.
Chief Underwriting Officer	Qualified actuary (FASSA or equivalent) with deep short-term insurance experience; expert in personal lines pricing, predictive modelling, and reinsurance programme structuring.
Chief Technology Officer	Senior technology leader from a financial services or insurtech background; cloud-native architecture experience; track record of delivering at-scale consumer-facing platforms.
Chief Risk & Compliance Officer	Senior risk professional with PA / FSCA regulatory relationship experience; deep knowledge of SAM, ORSA, FAIS, and FICA frameworks; second-line independence.
Chief Marketing & Growth Officer	Direct-to-consumer marketing leader from a leading South African financial services or e-commerce brand; performance marketing and brand-build experience; data-driven approach.

Appendix D — Detailed Reinsurance Programme

The reinsurance programme is designed to (i) cap aggregate net loss
exposure consistent with the SAM Pillar I capital framework, (ii)
provide explicit catastrophe protection appropriate to the South African
weather-risk profile, and (iii) optimise the cost of risk transfer
relative to retained-capital opportunity cost. The programme is reviewed
annually and renegotiated bi-annually.

Programme Structure

Layer	Type	Retention	Limit	Cession	Commission
Quota share	Proportional	n/a	ZAR 500 m	20% (yrs 1-2)	23% sliding
Surplus treaty	Proportional	Variable	5 lines	Variable	20%
XOL — Motor	Non-proportional	ZAR 500 k	ZAR 5 m xs ZAR 500 k	100%	n/a
XOL — Property	Non-proportional	ZAR 1 m	ZAR 25 m xs ZAR 1 m	100%	n/a
CAT cover	Non-proportional	ZAR 25 m	ZAR 200-1,400 m	100%	n/a
Aggregate stop-loss	Annual aggregate	85% LR	10pp LR cover	100%	n/a

Counterparty Strategy

Reinsurance counterparties are selected from a panel of S&P
A-rated or better reinsurers, with single-counterparty exposure capped
at 25 percent of total ceded premium. The initial target panel includes
Africa Re, SCOR, Munich Re of Africa, Hannover Re, and Swiss Re,
providing geographic diversification and access to specialist capacity
for catastrophe and emerging risk layers.

End of plan.

Confidential — this business plan is provided to prospective investors and lenders for evaluation purposes only and may not be reproduced or distributed without the written consent of Nimbus Direct Insurance Group (Pty) Ltd.