The Financial Sector Conduct Authority has extended until 2029 an exemption for certain Category I and Category IV underwriting-manager financial services providers from the section 13 requirement in the General Code of Conduct to maintain suitable guarantees or professional indemnity or fidelity insurance cover.
FAIS Notice 41 of 2026, published on 30 June and effective from 1 July, extends the existing exemption by replacing its previous expiry date of 30 June 2026 with 30 June 2029.
The exemption was introduced in 2017, originally expiring on 31 December 2019. It was subsequently extended in 2019, 2021, and 2023.
Click here to download FAIS Notice 122 of 2017 – Exemption of Particular FSPs from Section 13 of the General Code of Conduct.
Notice 41 does not change the scope or conditions of the exemption; it simply extends its operation for a further three years.
Section 13 of the General Code of Conduct requires a provider (other than a representative, insurer, or bank), where required by the registrar, to maintain suitable guarantees or professional indemnity or fidelity insurance cover. Qualifying FSPs do not have to comply with that requirement when rendering the specified financial services, provided they meet the conditions in the exemption notice.
The exemption applies only to an authorised Category I or Category IV FSP that:
- is also an underwriting manager;
- renders only the specified financial services contemplated in the insurance regulations; and
- acts under a written mandate from the relevant insurer.
The exemption is subject to several conditions.
The FSP must:
- at all times have a written mandate from the relevant insurer to render the specified financial services on the insurer’s behalf;
- obtain annual written confirmation from the insurer that:
- the insurer accepts responsibility for the FSP’s activities; and
- the written mandate remains in force;
- submit that confirmation annually to the FSCA together with its financial statements; and
- comply with the disclosure requirements in sections 5(g) and 15(6) of the General Code of Conduct insofar as they relate to the exemption.
Failure to comply with any of these conditions will result in the exemption no longer applying to that FSP.
The practical effect is that the existing dispensation for qualifying underwriting-manager FSPs remains in place for another three years, provided the insurer mandate, annual confirmation, and disclosure requirements continue to be met.
