Short-Term Insurance Act, 1998 (Act No. 53 of 1998)Policyholder Protection RulesPart II : Summary of the Rules3. Summary |
| 3.1) | A policyholder who deals directly with an insurer without using an independent intermediary or otherwise asking for advice does so at his own risk and has only limited protection in terms of these Rules, unless such policyholder requests that all rights be maintained. The insurer is obliged to explain to the policyholder what his rights are. |
| 3.2) | All independent intermediaries shall disclose this Summary of the Rules to a policyholder at the earliest reasonable opportunity before entering into any initial or additional insurance transaction with that policyholder. The obligation to disclose this Summary does not apply to direct offerings by an insurer and may also be specifically waived by a policyholder. |
| 3.3) | All independent intermediaries shall ensure that they disclose at the earliest reasonable opportunity to a policyholder that they deal with, full details of their identity, their qualifications and experience, which insurance products they may sell and which companies they represent and in what legal capacity they operate. |
| 3.4) | All policyholders entering into an insurance transaction are entitled to be provided with adequate information about the impact of any decision that they are being asked or elect to make. This includes cost, affordability, impact on their insurance portfolio, flexibility and contract terms. |
| 3.5) | An insurer shall ensure that it communicates at least once with a policyholder to provide details of:- its identity; the product being purchased or transaction being undertaken, including, the relevant costs associated with the transaction; the contractual terms and the institutional details for transactions and complaints. |
| 3.6) | An insurer shall ensure that it accredits independent intermediaries on the products that those independent intermediaries may sell or service for that insurer, based on appropriate information and training. |
| 3.7) | Any policyholder that has a complaint about the conduct of an independent intermediary or insurer in complying with these rules or otherwise must address that complaint to the compliance officer at the insurer or to the short-term insurance ombudsman if applicable or if still unsatisfied to the Authority at the Financial Services Board. |
| 3.8) | Any insurer or independent intermediary that fails to comply with these Rules may be guilty of an offence and liable for prosecution. |
| 3.9) | An insurance party involved shall ensure that where a policy is to be entered into or varied, disclosures of particular information are made to each policyholder concerned prior to the relevant effective date of such entering into or variation, in accordance with the provisions of the Rules in Part III. |
| 3.10) | All disclosures contemplated in rule 3.9 shall be in writing or, if so made orally or otherwise at the request of the policyholder, be confirmed in writing (any such written document being referred to in these Rules as a disclosure document) within thirty days after such disclosure and shall be furnished to every policyholder. |
| 3.11) | The furnishing of any disclosure document shall not prevent a policyholder from lodging a complaint with any insurance party involved or the Authority or any other appropriate body or person, or from obtaining any other legal redress, on the grounds of misleading or false disclosures, or for any non-disclosure, or on any other ground related to such disclosures or non-disclosures recognised by law for the purposes of such redress. |
| 3.12) | The following principles shall apply in regard to disclosures contemplated in Part III: |
| a) | The onus of compliance with the provisions of this Part shall rest on the insurance party involved: Provided that a responsibility shall vest in the insurer to be satisfied by the taking of reasonable steps that where such onus rests on an independent intermediary, that independent intermediary shall at all times properly comply with the provisions contained in Part III; |
| b) | disclosure documents must be framed in plain language and in a format designed to promote easy comprehension and to avoid uncertainty or confusion. |