The Enforcement Committee received a case from the Registrar of Long-Term Insurance regarding Assupol Life Limited. The Registrar found that from August 2014 to June 2016, Assupol contravened Section 49 of the Long-Term Insurance Act by allowing its independent intermediaries to share in underwriting profits.
They were also found to contravene Rule 16.1 of the Policyholder Protection Rules (PPRs) by rejecting claims without advising policyholders of their rights, in particular:
- their right to lodge a complaint under the Financial Services Ombud Schemes Act, 2004 (Act 37 of 2004); and
- the time limitation for the institution of legal proceedings.
The Registrar found that Assupol failed to properly conduct oversight of their outsourced functions and that its failures to comply with the PPRs had the potential of causing prejudice to its policyholders whose claims were rejected.
The Registrar agreed to a penalty of R500 000 for the contraventions and the penalty was imposed on Assupol by the Enforcement Committee.