Insurance & Reinsurance
The Financial Sector Conduct Authority ("FSCA") today published a communication on its website titled "FSCA Communication 7 of 2019 (INSURANCE)" dated 27 September 2019 ("Communication 7") which extends the period of compliance with certain regulations pertaining to premium collection by independent intermediaries in terms of both the Short-term Insurance Act, 53 of 1998 ("STIA") and the Long-term Insurance Act, 52 of 1998 ("LTIA").
Communication 7 specifically provides that the FSCA has agreed to extend the period of time in which to comply with Regulation 4.2(3) issued under the STIA and Regulation 8.2(2) issued under the LTIA, from 28 September 2019 to 1 February 2020.
Regulation 4.2(3) and Regulation 8.2(2) issued under the STIA and LTIA respectively deal with the requirement that all premiums collected by an independent intermediary must be collected into a separate bank account, which may only contain monies collected from policyholders (and not the funds of the independent intermediary).
The aforesaid extension follows various exemption applications received by the FSCA from independent intermediaries. In this regard, the FSCA emphasises that Part 4 and Part 8 of the Regulations issued under the STIA and the LTIA specifically require an insurer to bring an application for an exemption (and not the independent intermediary).
A copy of Communication 7 can be accessed here.