On 3 April 2020, the Financial Sector Conduct Authority (FSCA) published FSCA Communication 14 of 2020 (INS) which outlines the expectations of the FSCA regarding the culture and responsibilities of insurers and financial services providers (FSPs) in respect of premium collection of funeral policies during the COVID-19 crisis. The FSCA advises insurers to ensure that all customers are treated fairly during the entire product cycle, from advertising to sales, premium collection, claims, renewals and complaints.
The Communication discloses that it has come to the FSCA’s attention that certain funeral parlours who are also carrying on business as authorised FSPs are conducting business in a manner that is contrary to the lockdown Regulations. The safety of clients may be compromised as clients are requested to visit the parlours’ offices to make premium payments and wait in long queues within close proximity to each other, thus posing a risk to all nearby.
While the FSCA acknowledges the importance of premium payments by customers, it urges funeral parlours that collect cash from clients to do so in compliance with the Regulations, particularly social distancing, and where possible electronic payments are encouraged.
The Communication further advises insurers to take into consideration that the Policyholder Protection Rules under the Long-term Insurance Act, provide for a grace period in instances where a premium has not been paid on its due date. It is expected that insurers will notify policyholders accordingly in this regard.