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

Prescribed requirements for the calculation of the value of the assets, liabilities and capital adequacy requirement of short-term insurers

1. Definitions

Purchase

(Paragraph 2 of Schedule 2 of the Short-term Insurance Act, 1998)

In these Requirements, unless the context indicates otherwise:

"Act"

means the Short-term Insurance Act, 1998 (Act No. 53 of 1998), and a word or expression to which a meaning has been given in the Act, has that meaning;

"admissible assets"

means the kinds of assets specified in section 29 of the Act;

"cash-back bonus"

means a benefit specified in the policy document, where the policyholder receives a pre-determined benefit, in relation to the gross premiums received by the insurer, after a specified period of time under specified conditions as specified in the policy document;

"capital requirement"

in relation to a regulated financial institution, means the capital or solvency margin, and will include any additional asset requirements, as the case may be, required for that institution by the regulatory authority concerned;

"cell"

represents an equity participation as shareholder in a different class of shares that is restricted to the results of the insurance business which the shareholder places in an insurer; the results of such business are determined in accordance with an agreement with the participating shareholder; the different class of shares has specified dividend rights-and/or capital risk financing;

"group undertaking"

means a juristic person in which the insurer alone, or with its subsidiaries or holding company, directly holds 20% or more of the shares, if the juristic person is a company, or 20% or more of any other ownership interest, if the juristic person is not a company;

"listed"

means listed on a stock exchange or similar trading facility, which is recognised generally by the international community of institutional investors;

"net asset value"

in relation to a group undertaking, means its net asset value calculated in accordance with paragraph 3.1.10;

"regulated financial institution"

means:

a)	a financial institution as defined in paragraph (a) of the definition of 'financial institution' in section 1 of the Financial Services Board Act, 1990 (Act No. 97 of 1990);

b)	a bank as defined in section 1(1) of the Banks Act, 1990 (Act No. 94 of 1990), or a mutual bank as defined in section 1(1) of the Mutual Banks Act, 1993 (Act No. 124 of 1993);

c)	an entity that carries on business similar to the business of an entity referred to in paragraphs (a) or (b), which is not regulated by a law that regulates an entity referred to in paragraph (a) or (b), but which is subject to substantially similar regulation outside South Africa;

"return"

means the returns prescribed by the Authority in terms of section 35 of the Act;

"Schedule 2"

means Schedule 2 of the Act