Long Term Insurance Act, 1998 (Act No. 52 of 1998)Part VII : Business practice, policies and policyholder protectionBusiness practice46. Policy to be actuarially sound |
| 1) | A long-term insurer shall not— |
| a) | enter into any particular kind of long-term policy unless the statutory actuary is satisfied that the premiums, benefits and other values thereof are actuarially sound; |
| b) | make a distinction between the premiums, benefits or other values of different long-term policies unless the statutory actuary is satisfied that the distinction is actuarially justified; or |
| c) | award a bonus or similar benefit to a policyholder unless— |
| i) | it is done in accordance with the principles and practices of financial management of the long-term insurer; and |
| ii) | the statutory actuary is satisfied that it is actuarially sound and that a surplus is available for that purpose. |
| 2) | For the purposes of subsection (1)(c)(i) "principles and practices of financial management" means a statement approved by the board of directors of the long-term insurer setting out the discretion retained by the board of directors and the parameters within which that discretion must be exercised in respect of long-term policies where the long-term insurer has to exercise its discretion in awarding a bonus or similar benefit. |