The proposed amendments to the Policyholder Protection Rules (PPRs) were recently published in Board Notice 30 of 2018.
The scope of the proposed amendments to the PPRs is to align the PPRs with the Insurance Act, enacted on 18 January 2018. This new Insurance Act, which has not yet come into effect, provides the framework for the prudential supervision over long-term and short-term insurers, with this supervision moving from the FSB to the South African Reserve Bank in line with Twin Peaks.
The Insurance Act introduces new authorisation classes of insurance business, which are significantly more granular than the current “classes” or types of policies provided for under the Long-Term Insurance Act (LTIA) and the Short-Term Insurance Act (STIA).
The Insurance Act amends the LTIA and the STIA by repealing some of the existing conduct of business provisions in these Acts. These repealed conduct of business requirements, which relate to insurers’ interactions with policyholders and underpin fair outcomes for policyholders, don’t disappear entirely but are incorporated into the proposed amendments to the PPRs.
The proposed amendments also make provision for microinsurance product standards by giving effect to the National Treasury’s Micro Insurance Policy Document. This Policy Document aims to create a dedicated microinsurance license that will promote financial inclusion, encourage entry of new providers into the market and enhance consumer protection through appropriate prudential and business conduct regulation.
Comments on the Proposed PPRs may be submitted in writing on or before 13 April 2018 to the Financial Services Board, at FSB.INSProposedPPRs@FSB.co.za.
Download the documents by clicking on the links below:
- Board Notice 30 of 2018
- Tranche 2 draft amendment to the Long-term Insurance PPRs (track)
- Tranche 2 draft amendments to the Short-term Insurance PPRs (track)
- Statement supporting Tranche 2 amendments to PPRs March 2018
- PPRs ANNEXURE A – Draft amendments to LTIA PPRs
- PPRs ANNEXURE B – Draft amendments to STIA PPRs
- LT PPRs comments template
- ST PPRs comments template