On 11 August 2017, the National Credit Regulator (NCR) released a media statement on the final credit life insurance regulations published under Government Gazette Notice No 103 which became effective on 10 August 2017.
In this statement, Lesiba Mashapa, Company Secretary at the NCR advised, among others, that:
“Consumers that are not employed cannot be sold retrenchment cover. A consumer who dies or becomes permanently disabled will have his or her outstanding debt under a credit agreement settled by the credit life insurance policy. If the consumer loses his or her job, the policy will pay instalments due under a credit agreement for up to 12 months.
It is important to note though, that these regulations are not retrospective. Consumers who have a life cover can use it to cover their debts and should not be forced to take out a new insurance as long as the life cover is sufficient to cover the debt in case of a claim.”
Please click here to download a copy of the full media release.