Long Term Insurance Act, 1998 (Act No. 52 of 1998)

Regulations

Regulations under the Long-term Insurance Act, 1998

Part 4 : Limitation on Provisions of Certain Policies (Section 54)

4.1 Definitions

Purchase

In this part—

"excess premium"

means a premium which is received by, or which becomes due to, a long-term insurer during a premium period, and which—

(a)	by itself exceeds;

(b)	when aggregated with all premiums already received, and still to be received, during that premium period, exceeds; or

(c)	is the first of increased recurrent premiums which, if it had been received by the long-term insurer at that increased rate during that premium period, would have caused the total value of the premiums received by the long-term insurer during that premium period to exceed,

by a rate of more than 20 per cent, the higher of the total value of the premiums received by the long-term insurer during any one of the two premium periods immediately preceding that premium period: Provided that if a premium is increased during the second premium period, the percentage increase shall be determined in relation to the first premium period only;

[Definition substituted by regulation 5(a) of Notice No. 1437 of 2017]

"extended restriction period"

means a restriction period—

(a)	which has not expired;

(b)	which includes every earlier restriction period any part of which runs concurrently with it; and

(c)	the commencement date of which, from time to time, is the commencement date of the earliest restriction period which runs concurrently with it;

"free surrender value"

means the value of the consideration which the long-term insurer would provide if the policy is surrendered on the day preceding the date of commencement of an extended restriction period;

"fund member policy"

has the meaning assigned to it in Part 3A;

[Definition substituted by regulation 6(a) of Notice No. 1015, GG 41942, dated 28 September 2018]

"linked benefit"

means a policy benefit, the value of which is not guaranteed by the long-term insurer and is determined solely by reference to the value of particular assets or particular categories of assets which are specified in the policy and which are actually held by or on behalf of the long-term insurer specifically for the purpose of the policy;

"policy"

means a long-term policy, whether entered into before or after the commencement of this Act, excluding—

(a)	a reinsurance policy;

(b)	a fund policy;

(c)	a fund member policy, for as long as no right under the policy is transferred by the fund to a life insured under the policy, or is transferred to any person except another fund for the direct or indirect benefit of a life insured under the policy; or

(d)	a living annuity as defined in section 1 of the Income Tax Act, 1962 (Act No. 58 of 1962);

[Definition substituted by regulation 5(c) of Notice No. 1437 of 2017]

"policy benefit"

has the meaning assigned to it in the Act, but excludes a loan in respect of a policy or consideration upon the surrender of a policy;

[Definition substituted by regulation 6(b) of Notice No. 1015, GG 41942, dated 28 September 2018]

"premium"

[Definition deleted by regulation 6(c) of Notice No. 1015, GG 41942, dated 28 September 2018];

"premium period"

means one of a succession of periods, each of 12 months' duration, the first of which begins on, and ends 12 months after, the first day of the month in which the first premium, or any part thereof, is received by the long-term insurer or, if it is a later date, the first day of the month in which the undertaking of the long-term insurer to provide policy benefits under the policy, becomes operative;

"restricted amount"

means an amount equal to—

(a)	the aggregate of the free surrender value, and the total value of the premiums received by the long-term insurer during the extended restriction period concerned, plus interest on the free surrender value and each premium at the rate of 5 per cent per annum compounded annually; less

(b)

the aggregate of all payments already made by the long-term insurer in respect of the policy, whether as a policy benefit (other than a policy benefit referred to in subregulation (2) of regulation 4.2) or upon the surrender of any part of the policy, during the extended restriction period concerned, plus interest on each payment at 5 per cent per annum compounded annually;

"restriction period"

means a period of 5 years which commences, if the date concerned is 1 January 1994 or later—

(a)	on the date when the first premium period begins; or

(b)	during a premium period after the first such period, on the first day of the month in which an excess premium is received by the insurer.