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 Applies3.9 Special provisions concerning replacement investment policies |
[Heading of regulation 3.9 substituted by regulation 4(s) of Notice No. 1437 of 2017]
| (1) | Commission may only be paid in respect of a replacement investment policy as a level percentage of the premiums received, and may only be paid once the premium in respect of which it is payable has been received by the long-term insurer concerned, whether or not— |
| (a) | the replacement investment policy comprises more than one benefit component; or |
| (b) | the portion of the total premium attributable to the different benefit components of the replacement investment policy is specified in or ascertainable from the written provisions of the policy. |
(2)
| (a) | The total amount of commission paid on a replacement investment policy may not exceed the total of the primary and secondary commission that would have been payable in terms of this Part in respect of a policy other than a replacement investment policy; and |
| (b) | in determining such total amount, the long-term insurer concerned may include interest 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 from the earliest date on which the full amount of primary or secondary commission could have been paid if the policy was not a replacement investment policy, until such full amount has been paid. |
| (3) | In the event of commission on a replacement investment policy being paid or accepted otherwise than in accordance with subregulation (1) or (2), whether due to the fact that the long-term insurer was not aware at the time of payment that the policy in question was a replacement investment policy, or for any other reason, then any commission paid by the long-term insurer in excess of the commission payable in accordance with subregulation (2), or paid earlier than permitted in subregulation (1), shall upon identification of the excess or early payment, be reversed and refunded to the long-term insurer by the person to whom it was paid. |
[Regulation 3.9 substituted by regulation 4(s) of Notice No. 1437 of 2017]