New legislation will entail changes to the wording of contracts between insurers and juristic representatives. Alan Holton explains the legislation, and how you can address the changes:
Thanks for the most useful summary of the pending legislative changes.
There is one little change that sneaked in, which nobody seems to have noticed:
Paragraph 186(d) of the Bill (at page 87) provides as follows:
186(d) Section 13 of the principal Act is hereby amended by the deletion in subsection (1) of the word ‘‘or’’ at the end of paragraph (a), the addition of the word ‘‘or’’ at the end of paragraph (b) and the addition of the following paragraph:
‘‘(c) render financial services or contract in respect of financial services other than in the name of the financial services provider of which such person is a representative.’’
Section 13(1)(c) will now read: ”A person may not render financial services or contract in respect of financial services other than in the name of the financial services provider of which such person is a representative.”
This means, inter alia, that all financial service related contracts currently concluded between Juristic Representatives and insurers will have to be amended and reflect the name of the FSP. These include appointments as intermediaries of the insurer (required in terms of the Policyholder Protection Rules) and bank accounts into which premiums are paid if the Juristic Representative is currently collecting premiums and has IGF cover.
This will mean some fundamental changes will have to be implemented and it may be useful for FSP’s to begin planning now.