The FSCA recently published Notification Form INS008 in terms of the Policyholder Protection Rules (PPRs) made under the Long-term Insurance Act (LTIA) and Short-term Insurance Act (STIA). The notification form must be used by insurers to notify the FSCA where there is an intention to terminate a group scheme policy as contemplated in Rule 20.2.4 and Rule 20.3.1 of the LTIA PPRs and Rule 19.2.4 and Rule 19.3.1 of the STIA PPRs.
In terms of these PPRs:
- Where an insurer intends to terminate a group scheme policy, the insurer must:
– Give the policyholder and the FSCA at least 31 days written notice of the intended termination;
– Be able to demonstrate that it has taken reasonable steps to provide the members of the group scheme with notice of the intended termination.
- Where a policyholder terminates or intends to terminate a group scheme policy, the insurer of the policy being terminated must:
– notify the FSCA of the termination or intended termination as soon as reasonably possible after becoming aware of the termination or proposed termination.
Although this form primarily applies to insurers, FSPs that deal with group schemes should be aware of the insurer’s obligations as the purpose of this notification is to ensure that policyholders are treated fairly.