Short-Term Insurance Act, 1998 (Act No. 53 of 1998)

Part VII : Business practice, policies and policyholder protection

Purchase

(1)	The Authority, by notice in the Gazette, may—

(a)	prescribe rules not inconsistent with this Act, aimed at ensuring for the purpose of policyholder protection that policies are entered into, executed and enforced in accordance with sound insurance principles and practice in the interests of the parties and in the public interest generally;

[Section 55(1)(a) substituted by item 15(a) of schedule 1 of Act No. 18 of 2017, GG 41388, dated 18 January 2018]

(b)	vary or rescind any such rule; and

(c)	determine the period which must elapse before a rule, variation or rescission takes effect after it has been published in the Gazette.

(2)	Without derogating from the generality of subsection (1)(a), rules may provide—

(a)	that provisions with a particular import may not appear in a policy and that they shall be void if they do so appear;

(b)	that the policy and particular information in relation to a policy shall be made known in a particular manner to a prospective policyholder or policyholder, and what the legal consequences shall be if that is not done;

[Section 55(2)(b) substituted by item 15(b) of schedule 1 of Act No. 18 of 2017, GG 41388, dated 18 January 2018]

(c)	that a policyholder may cancel a policy under particular circumstances and within a determined period, and what the legal consequences shall be if he or she does so;

(d)	for norms and standards with which policies, short-term insurers or types of short-term insurance business must comply;

(e)	for standardised wording, definitions or provisions that must be or may not be included in policies;

[Section 55(2)(e) substituted by item 15(c) of schedule 1 of Act No. 18 of 2017, GG 41388, dated 18 January 2018]

(f)	for principles and requirements relating to any advertisement, brochure or similar communication which relates to the business of a short-term insurer, or to a short-term policy;

(g)	for principles and requirements relating to claims handling, complaints handling and dispute resolution applicable to short-term insurers;

(h)	for principles and requirements relating to the manner and form in which policy benefits must be provided;

(i)	for principles and requirements relating to misrepresentation in relation to a short-term policy;

(j)	for requirements relating to the validity of a contract under a short-term policy;

(k)	for principles and requirements relating to non-payment of premiums and grace periods in relation to a short-term policy, and related disclosures to policyholders;

(l)	for principles and requirements relating to insurance product design and ongoing review of insurance product performance to ensure the fair treatment of policyholders;

(m)	for principles and requirements relating to a short-term insurer’s dealings with intermediaries;

(n)	for principles and requirements relating to data management in order to appropriately identify, assess, measure and manage the conduct of business risks associated with its insurance business to ensure the fair treatment of policyholders; and

(o)	for principles and requirements relating to the termination of policies.

[Section 55(2)(f-o) inserted by item 15(d) of schedule 1 of Act No. 18 of 2017, GG 41388, dated 18 January 2018]

(3)	Rules referred to in subsection (2) may—

(a)	apply generally;

(b)	be limited in application to a particular kind or type of policies, short-term insurers or short-term insurance business; or

(c)	differentiate between different kinds of insurers, policies, contracts and services.

[Section 55(3) substituted by item 15(e) of schedule 1 of Act No. 18 of 2017, GG 41388, dated 18 January 2018]

(4)	[Section 55(4) deleted by section 290, item 11 in Schedule 4, of Act No. 9 of 2017 - effective 1 April 2018 (paragraph (h) of Notice 169 of 2018)]

(5)	Any rule promulgated by the Minister prior to the commencement of the Financial Services Laws General Amendment Act, 2013, must be regarded as having been prescribed under this section, and remains valid and enforceable until repealed or amended by the Authority.

[Section 55(5) substituted by item 15(f) of schedule 1 of Act No. 18 of 2017, GG 41388, dated 18 January 2018]

[Section 55 substituted by section 138 of Act No. 45 of 2013]