FSCA EXEMPION FOR CLASSES AND SUB-CLASSES OF INSURANCE BUSINESS
In 2017, new classes and sub-classes of insurance business were introduced through the Insurance Act, 18 of 2017 and the FAIS Determination of Fit and Proper Requirements for Financial Services Providers, 2017 (Fit and Proper Requirements) was amended accordingly.
As a result:
FSPs that render financial services in respect of credit life products, require Long-term insurance subcategory B1 and/or long-term insurance subcategory B2 on their scope of license; and
FSPs that render financial services in respect of funeral products require Long-term insurance subcategory A.
The introduction of new classes and sub-classes of insurance business, and the subsequent amendments of the Fit and Proper Requirements, has resulted in instances where FSPs, representatives and key individuals are no longer authorised for the correct FAIS licensing categories and key individuals and representatives do not comply with some of the competence requirements applicable to the relevant subcategories of financial products.
The Financial Sector Conduct Authority (FSCA) believes that these complications were unintentional and must not result in undue prejudice against the affected persons. As such, the FSCA has published an exemption in respect of the class of business training, qualifications, and experience requirements applicable to all affected persons to facilitate and ensure a fair transition to the new classification of financial products.
The exemption is granted subject to certain conditions with which the affected FSP must comply within 6 months of the date of publication of the exemption.