The Insurance Act will come into effect on 1 July 2018.
The act was assented to in January 2018.
Parliament passed the bill in December 2017.
The bill was tabled in parliament in January 2016.
The act aims to put a legal framework in place for the prudential supervision of insurance businesses in South Africa that meets international standards for insurance regulation and supervision.
It also seeks to promote financial inclusion and financial transformation through the introduction of a micro-insurance regulatory framework.
The policy objectives of the act include:
• Enhancing access to insurance;
• Enhancing financial soundness; and
• Alignment with international standards.
The act seeks to:
• provide for a legal framework for the prudential regulation and supervision of insurance business in the Republic that is consistent with the Constitution of the Republic of South Africa, 1996, and promotes the maintenance of a fair, safe and stable insurance market;
• introduce a legal framework for micro-insurance to promote financial inclusion;
• replace certain parts of the Long-term Insurance Act, 1998, and the Short-term Insurance Act, 1998; and
• provide for matters connected therewith.
A new Solvency Assessment and Management regime will be introduced as well as a framework for insurance group supervision.
The act also aims to facilitate alignment with international standards in accordance with South Africa’s G20 commitments.
The act addresses regulatory gaps identified by the IMF/World Bank’s Financial Sector Assessment Program evaluation of South Africa.
The commencement date was announced in Government Gazette 41735.
The act comes into force except the repeal of sections 48, 52, 53, 56, 59 and 60 of the Long -term Insurance Act and sections 46, 47, 51, 53 and 54 of the Short -term Insurance Act.