10.1 Definitions
In this rule—
"advertisement"
[Definition deleted by rule 7(a) of Notice No. 997, GG 41928, dated 28 September 2018]
"comparative"
refers to a direct or indirect comparison between insurers or between the policies or related services of one or more insurers;
"endorsements"
refer to public statements declaring the virtues of a policy or related service of an insurer or recommending the entering into of a policy or related service;
"group of companies"
has the meaning assigned to it in the Insurance Act;
[Definition substituted by rule 7(b) of Notice No. 997, GG 41928, dated 28 September 2018]
"holding company"
has the meaning assigned to it in the Companies Act, 2008 (Act No. 71 of 2008);
"publish"
means to—
| (b) | make public announcement of; |
| (c) | disseminate to the public; or |
| (d) | produce or release for distribution; |
and "publication" has a corresponding meaning;
"puffery"
means any value judgments or subjective assessments of quality based solely on the opinion of the evaluator and where there is no pre-established measure or standard; and
"social media"
means websites, applications and other digital platforms that enable users to create and share content or participate in social networking and includes social and professional networks, forums, image and video-sharing platforms.
10.2 Application
| 10.2.1 | For purposes of this rule, "policyholder" includes a potential policyholder, a member and a potential member. |
| 10.2.2 | The principles, requirements and standards contained in this rule apply regardless of the medium used to publish an advertisement. |
| 10.2.3 | This rule applies to any advertisement published on or after the date on which this rule takes effect, regardless of whether the advertisement was also previously published prior to this rule taking effect. |
| 10.3.1 | An insurer must have documented processes and procedures for the approval of advertisements by a senior manager or a person of appropriate seniority to whom the senior manager has delegated the approval. |
| 10.3.2 | An insurer must, prior to publishing an advertisement, take reasonable measures to ensure that the information provided in the advertisement is consistent with this rule. |
| 10.3.3 | Where feasible, measures must provide for an objective review of an advertisement other than by the person that prepared or designed them. |
| 10.3.4 | Where an advertisement is produced or published by another person the insurer must— |
| (a) | where the person producing or publishing the advertisement is the insurer's representative or is otherwise acting on behalf of the insurer in relation to the advertisement, ensure that the advertisement is consistent with this rule and have appropriate processes in place to ensure such consistency; and |
| (b) | where the person producing or publishing the advertisement is not acting on behalf of the insurer in relation to the advertisement but the insurer is aware or ought reasonably to be aware of the production or publication, take reasonable steps to mitigate the risk of the advertisement not being consistent with this rule. |
| 10.3.5 | Where an insurer becomes aware that an advertisement that relates to its business, policies or related services, whether published by the insurer or any other person, is not consistent with this rule, the insurer must— |
| (a) | as soon as reasonably practicable correct or withdraw the advertisement; or |
| (b) | take reasonable steps to ensure that it is corrected or withdrawn; and |
| (c) | notify any persons who it knows to have relied on the advertisement. |
10.4 Factually correct, balanced and not misleading
| 10.4.1 | Advertisements must— |
| (a) | be factually correct, excluding aspects of an advertisement constituting puffery; |
| (b) | provide a balanced presentation of key information; and |
Factually correct
| 10.4.2 | If statistics, performance data, achievements or awards are referenced in an advertisement the source and the date thereof must be disclosed. |
| 10.4.3 | An advertisement that refers to premiums must - |
| (a) | in the case where the premium will escalate automatically, indicate the escalation rate or basis; and |
| (b) | where the premium (with or without automatic escalations) is not guaranteed for the full term of the policy but is subject to review after a period as contemplated in rule 15, indicate the period for which the premium is guaranteed. |
Balanced
| 10.4.4 | Descriptions in an advertisement must not exaggerate benefits or create expectations regarding policy performance or the performance of related services that the insurer does not reasonably expect to achieve. |
| 10.4.5 | Descriptions in an advertisement, in respect of a specific policy or related service, must include key limitations, exclusions, risks and charges, which must be clearly explained and must not be worded positively to imply a benefit. |
| 10.4.6 | Notwithstanding rule 10.4.5, but subject to all other requirements of this rule, where an insurer can demonstrate that, due to the nature of the medium used for the advertisement, it is not reasonably practicable for the information required in rule 10.4.5 to be fully included in the advertisement itself, the advertisement must indicate— |
| (a) | that additional information on key limitations, exclusions, risks and charges related to the policy or related service being advertised is available; and |
| (b) | where and how the additional information in paragraph (a) may be accessed. |
| 10.4.7 | The information referred to in rule 10.4.6 must be publicly available and readily accessible to the average policyholder targeted by the advertisement. |
Not misleading
| 10.4.8 | An advertisement, when examined as a whole, must not be constructed in such a way as to lead the average targeted policyholder to any false conclusions he or she might reasonably rely upon. |
| 10.4.9 | For the purposes of rule 10.4.8, an insurer must when constructing an advertisement consider the conclusions likely to be made by policyholders that are subject to the advertisement, and in doing so have regard to— |
| (a) | the literal meaning of the words; |
| (b) | impressions from nonverbal portions of the advertisement; and |
| (c) | materials and descriptions omitted from the advertisement. |
| 10.4.10 | An advertisement must not obscure information. |
| 10.4.11 | Each piece of information in an advertisement must be prominent enough in accordance with rule 10.15 and proximate enough to other information so as not to mislead the average targeted policyholder. |
| 10.4.12 | An advertisement must not be designed to exaggerate the need for urgency which could encourage the average targeted policyholder to make unduly hasty decisions. |
| 10.4.13 | An advertisement may not use the term “funeral” or any derivative thereof in relation to a policy, or suggest or create the impression that a policy is intended to cover funeral costs or any costs associated therewith unless the benefit under the policy is a lump sum, or specified or determinable equal or unequal sums of money payable at specified intervals to cover the cost associated with a funeral or the rendering of a service on the happening of a death event |
[Rule 10.4.13 inserted by rule 7(c) of Notice No. 997, GG 41928, dated 28 September 2018]
An advertisement must not disparage or make inaccurate, unfair or unsubstantiated criticisms about any financial product, financial service, product supplier or intermediary.
| 10.6 | Identification of insurer |
| 10.6.1 | An advertisement relating to a policy must clearly and prominently in accordance with rule 1a.15 identify the insurer. |
| 10.6.2 | An advertisement must not use the group or parent company name or the name of any other associate of an insurer to create the impression that any entity other than the insurer is financially liable under a policy. |
| 10.6.3 | An advertisement must not use the name of another person to mislead or deceive as to the true identity of the insurer or to create the impression that any person other than the insurer is financially liable under a policy. |
| 10.6.4 | An advertisement relating to a policy that is subject to a white labelling arrangement must clearly and prominently in accordance with rule 10.15 identify the insurer. |
| 10.7 | Appropriate language and medium |
| 10.7.1 | An advertisement must use plain language. |
| 10.7.2 | Terms must be defined or explained if the average targeted policyholder could not reasonably be expected to understand them. |
| 10.7.3 | An insurer must consider the appropriateness of the medium to be used to publish any advertisement in relation to the complexity of the policy features or other information being communicated. |
| 10.8 | Record keeping of advertisements |
| 10.8.1 | An insurer must keep adequate records of all advertisements. |
| 10.8.2 | All records referred to in rule 10.8.1 must be kept for a period of at least 5 years after publication. |
| 10.9 | Negative option marketing |
An insurer or any person acting on its behalf may not offer to enter into a policy on the basis that the policy will automatically come into existence unless the policyholder explicitly declines the insurer's offer to enter into the policy.
| 10.10 | Unwanted direct advertising |
| 10.10.1 | Where an insurer or any person acting on its behalf uses a telephone or mobile phone call, voice or text message or other electronic communication for an advertisement, it must allow the policyholder during that call or within a reasonable time after receiving the message, the opportunity to demand that the insurer or other person does not publish any further advertisements to the policyholder through any of these mediums. |
| 10.10.2 | An insurer or any person acting on its behalf may not charge a policyholder a fee or allow a service provider to charge a policyholder any fee for making a demand in terms of rule 10.10.1. |
| 10.11 | Comparative marketing |
| 10.11.1 | Where a survey or other product or service comparison informs a comparative advertisement, the survey or other product or service comparison— |
| (a) | must be undertaken by an independent person or, if it is not reasonably practicable that it is undertaken by an independent person, the advertisement must be so qualified; |
| (b) | must be conducted at regular intervals if relied on or referenced on an on-going basis; |
| (c) | must ensure that policies, products or related services being compared have the same or similar characteristics; |
| (d) | must take account of comparable features across the policy, product or related service offerings included in the sample to ensure that not only the price (e.g. the Rand value of premiums) is being compared, but also the benefits provided under the policies, products or related services concerned; |
| (e) | in particular, in the case of comparisons between policies, must ensure that price comparisons are based on policies with equivalent terms and conditions, including insured events, cover levels, exclusions, waiting periods and other key features to those of the insurer's policies used in the comparison; and |
| (f) | may not focus on the price of a policy, product or related service to the exclusion of the suitability of the policy, product or related service or its delivery on customer expectations. |
| 10.11.2 | The survey or other comparison source and date thereof must be referenced in the advertisement and the methodology applied must be publicly available and readily accessible to the public in an easily understandable format. |
Advertisements that include puffery must be consistent with the provisions relating to puffery in the Code of Advertising Practice issued by the Advertising Standards Authority of South Africa as amended from time to time.
| 10.13.1 | Testimonials and third party endorsements used in an advertisement— |
| (a) | must be the genuine opinion and actual experience of the person making the testimonial or endorsement and be properly attributed to such person; |
| (b) | must be based upon actual statements made for testimonial or endorsement purposes; and |
| (c) | may use a pseudonym instead of the real name of the person making the testimonial or endorsement, provided this is stated in the advertisement concerned. |
| 10.13.2 | If the person making the testimonial or endorsement, or their employer or principal or any associate, has any financial interest or relationship to the insurer or any associate of the insurer or person acting on behalf of the insurer, or will or has been compensated for the endorsement by any person (other than through reimbursement of actual costs incurred by the person making the endorsement), this must be disclosed in the advertisement. |
| 10.13.3 | Any endorsement in an advertisement must clearly and prominently in accordance with rule 10.15 state that the endorsement does not constitute financial advice. |
| 10.14 | Loyalty benefits or bonuses |
| 10.14.1 | An advertisement that references a loyalty benefit, no-claim bonus or rebate in premium must not create the impression that such benefit or bonus is free and must adequately— |
| (a) | indicate if the loyalty benefit, no-claim bonus or rebate in premium is optional or not; and |
| (b) | regardless of whether or not the loyalty benefit or no-claim bonus is optional, express the cost of the benefit, bonus or rebate in premium including, where applicable, the impact that such cost has on the premium, unless the impact is negligible. |
| 10.14.2 | Rule 10.14.1 does not apply in respect of benefits a policyholder may receive from an insurer because that policyholder, together with all the policyholders of that insurer, is an owner or a member of the insurer or the direct holding company of that insurer. |
| 10.14.3 | For purposes of rule 10.14.1— |
| (a) | the impact is deemed to be negligible if the cost of the loyalty benefit, no-claim bonus or rebate in premium comprises less than 10% of the total premium payable under the policy; |
| (b) | where the impact of a loyalty benefit, no-claim bonus or rebate in premium is not negligible and where the advertisement refers to the actual premium payable— |
| (i) | the cost of the benefit, bonus or rebate must be shown as a percentage of that premium; and |
| (ii) | the insurer must be able to demonstrate that the premium and benefit cost used in the advertisement presents a true reflection of the cost impact for the average targeted policyholder; and |
| (c) | where the impact of a loyalty benefit, no-claim bonus or rebate in premium is not negligible and where the advertisement does not refer to the actual premium payable, the average cost of the benefit, bonus or rebate as a percentage of premium must be provided. |
| 10.14.4 | Where an advertisement highlights a loyalty benefit, no-claims bonus or rebate in premium as a significant feature of a policy and makes reference to a projected value or rebate in premium that is payable on the expiry of a period in the future, it must also express the value of the projected benefit, bonus or rebate in present value terms, using reasonable assumptions about inflation. |
| 10.14.5 | An advertisement must clearly state whether the availability or extent of a loyalty benefit, no-claims bonus or rebate in premium is contingent on future actions of the policyholder or any factors not within the policyholder's control. |
| 10.14.6 | An advertisement may not create the impression that the bonus, benefit or rebate is guaranteed or more likely to materialise than the insurer reasonably expects for the average targeted policyholder. |
[Rule 10.14 substituted by rule 7(d) of Notice No. 997, GG 41928, dated 28 September 2018]
| 10.15.1 | In determining prominence, whenever information must be disclosed prominently as required by these rules, consideration must, as appropriate, be given to— |
| (a) | the target audience of the advertisement; |
| (b) | the likely information needs of the average targeted policyholder; |
| (c) | prominence in the context of the advertisement as a whole; |
| (d) | positioning of the text and audibility and speed of speech; |
| (e) | the duration of displays of key information; |
| 10.15.2 | A statement or information in an advertisement is not regarded as being prominent if, amongst other things, the statement or information is— |
| (a) | obscured through the close proximity of promotional illustrations and/or additional text; |
| (b) | difficult to read due to the use of small font sizes, unclear type styles or the duration for which it is displayed; |
| (c) | likely to be overlooked due to its position; |
| (d) | superimposed across a coloured or patterned background which lessens its visual impact; or |
| (e) | difficult to hear or understand due to the volume or speed at which speech is delivered. |
| 10.15.3 | Subject to rule 10.15.4, in an advertisement relating to a policy that is subject to a white labelling arrangement, the name of the insurer must be as frequently mentioned, as audible or as visible as that of the white label and, in respect of written media, must be at least the same font size as that of the white label. |
| 10.15.4 | Rule 10.15.3 does not apply to an advertisement relating to a policy that is subject to a white labelling arrangement where— |
| (a) | the white label arrangement is with another insurer, a bank or a discretionary investment manager that is part of the same group of companies that the insurer is part of; |
| (b) | the advertisement uses the brand of the other insurer or the bank or discretionary investment manager; and |
| (c) | all requirements of rule 10.15.1 and 10.15.2 are complied with in relation to the identification of the insurer. |
| 10.16 | Principles relating to policies that have an investment value |
| 10.16.1 | This rule 10.16 applies to any advertisement in relation to policies that have an investment value. |
| 10.16.2 | No projected benefits (including but not limited to maturity, income, death, disability or full or partial surrender benefits) may be included in advertisements, if the policy benefits depend on future unknown investment performance, unless used to demonstrate the benefits of savings generally. |
| 10.16.3 | When past investment performance is provided for or referred to in an advertisement— |
| (a) | all information must be accurate and must be provided in the correct context, and the insurer must be able to substantiate all claims made; and |
| (b) | a statement must be included that past performance cannot be extrapolated into the future and is not an indication of future performance. |
| 10.16.4 | If tax advantages are referenced in an advertisement such advantages must be explained, and any key restrictions, penalties, and mitigating circumstances must be disclosed. |
| 10.16.5 | Any reference to guaranteed elements or features must indicate whether the guarantee is subject to any requirements and conditions and where disclosure of those requirements and conditions can be found. |
| 10.16.6 | Where a policy comprises participatory interests in an underlying collective investment scheme referred to in the Collective Investment Schemes Control Act, 2002 (Act No. 45 of 2002), or where a policy provides for investment of policyholder's funds into collective investment scheme portfolios, any advertisement must, in addition to the applicable requirements of this rule, comply with any determination of advertising and marketing requirements for collective investment schemes made under the Collective Investment Schemes Control Act, 2002 (Act No. 45 of 2002). |
