Rule 19 of the Policyholder Protection Rules (PPRs) made under the Long-term Insurance Act requires long-term insurers to meet certain requirements before entering into an individual risk policy that is a replacement policy. The FSCA (previously the FSB) had provided an initial draft format of the replacement advice record to industry associations for comment in March 2018. Masthead was one of five associations to provide feedback to the FSCA.
Click here to read the FSCA’s response to the informal consultation feedback published at the end of September 2018.
In the previous issue of Mastering Compliance, we provided the more recent Consultation Document on the Format for Replacement Advice Record (Individual Risk Policies) which was formally published by the FSCA at the end of August 2018. Although the responsibility in terms of Rule 19 of the PPRs is imposed on long-term insurers, this will have an impact on FSPs when replacing long-term individual risk policies. FSPs should, therefore, familiarise themselves with the proposed format of the replacement advice record so they are well prepared to obtain and record the information when this requirement takes effect, which is anticipated early in 2019.
Click here to read the previous Mastering Compliance article.