Insurance Act, 2017 (Act No. 18 of 2017)Chapter 6 : Financial SoundnessPart 2 : Security requirements for branches of foreign reinsurers and Lloyd's42. Failure to provide or maintain security |
| (1) | A branch of a foreign reinsurer or Lloyd’s must, without delay, notify the Prudential Authority of its failure to provide or maintain the security referred to in section 40 or any risk of non-compliance with the security requirements in the following three months. |
| (2) | The Prudential Authority may, in the circumstances referred to in subsection (1), or if the Prudential Authority reasonably believes that a branch of a foreign reinsurer or a Lloyd’s underwriter is failing to provide or maintain the security referred to in section 40— |
| (a) | direct a branch of a foreign reinsurer or Lloyd’s to submit a recovery scheme to the Prudential Authority for approval that sets out the measures that the branch of a foreign reinsurer or Lloyd’s will implement to restore the security; or |
| (b) | suspend or withdraw the licence of the branch of a foreign reinsurer or Lloyd’s underwriters and Lloyd’s. |
| (3) | In the circumstances referred to in subsection (2)(a), the Prudential Authority, despite the Trust Property Control Act, 1988 (Act No. 57 of 1988), is deemed to be the sole trustee of the trust and may exercise the powers of that trustee under the trust deed. |
| (4) | A branch of a foreign reinsurer or Lloyd’s whose recovery scheme was approved must submit a monthly progress report to the Prudential Authority that sets out the measures taken and the progress made with implementing the recovery scheme. |
| (5) | The Prudential Authority may restrict or prohibit certain activities or transactions of the branch of a foreign reinsurer or Lloyd’s underwriters until the security requirements are complied with. |
| (6) | A recovery scheme must include the matters as prescribed. |
| (7) | This section does not limit any other action that the Prudential Authority may take in terms of this Act. |