Long Term Insurance Act, 1998 (Act No. 52 of 1998)RegulationsRegulations under the Long-term Insurance Act, 1998Part 3 : RemunerationPart 3A : Limitation on Remuneration for Rendering Services as Intermediary - Policies other than Policies to which Part B Applies3.4 Maximum commission payable |
| (1) | No primary commission shall exceed, in respect of each kind of policy and benefit component specified in column 2 of Table 1 or Table 2, an amount arrived at by applying, in the case of— |
| (a) | a single premium policy, other than a fund policy and a group scheme, the percentage specified in column 3 of Table 1 or Table 2 to the amount of the premium concerned; |
| (b) | a multiple premium policy, other than a fund policy and a group scheme, the percentage specified in column 4 of Table 1 or Table 2 to the total amount of the premium payable during the premium -paying term, calculated as if the premium payable during the first premium period were payable at that level throughout the premium -paying term of the policy, which commission may be paid and accepted in one or more amounts at the discretion of the long -term insurer: Provided that such commission shall not exceed, in the case of a policy and benefit component specified in item 1.1, 2.1.1, 2.2.1, 3.2.1 and 5.1.1 of Table 1 or items 1(a), 4(a)(i), 4(b)(i), 5(a)(i)(aa), 5(a)(ii)(aa), 5(c)(ii)(aa), 6(a)(i), 7, 8(a) and 8(b)(i)(aa) of Table 2, an amount equal to the percentage specified in column 5 of Table 1 or Table 2 of the premium payable during the first premium period of the policy; or |
| (c) | a fund policy or a group scheme, an amount which shall not exceed 12/m of the aggregate commission on the annualised premium as provided for in Scale A. |
| (1A) | Despite anything in this Part, no commission shall exceed, in respect of a contract identified in category 1 and 3 in the table under regulation 7.2(1) of the Regulations, the maximum commission specified in column two of the Scale below: |
SCALE
Individual and group policy |
|
Column 1 |
Column 2 |
Monthly premium band |
Maximum Commission Level |
Above R1,200 |
5% |
R601 to R1,200 |
10% |
R300 to R 600 |
15% |
Less than R300 |
20% |
| (2) | No secondary commission shall exceed one-third of the amount of the primary commission paid in respect of the policy and benefit component concerned: Provided that if such commission is paid and accepted in more than one amount, the value thereof discounted at 15 per cent per annum, or such other rate of interest as may be prescribed by the Authority from time to time, compounded annually to the beginning of the second premium period of the policy, shall not exceed one third of the value of the primary commission excluding interest. |
[Regulation 3.4 substituted by regulation 5(k) of Notice No. 1015, GG 41942, dated 28 September 2018]