The Insurance Act (the Act) has been amended by the Statute Law (Miscellaneous Amendments) Act, 2017, which came into force on 4 May, 2017.
The amendments affect the Insurance Regulatory Authority (the IRA), banks and insurance companies. 

Selection of insurers by loanees 

Banks are now obliged to, among other things:

• provide loanees with a list of licensed underwriters or brokers for selection;
• inform loanees, in writing, that they have a right to select an underwriter or broker of their choice; and
• not to assign any underwriter or broker to a loanee unless the loanee has forfeited their right of selection in writing.

Recommendation:

Banks should revise and update their:

• standard terms of engagement in relation to the issuance of their loan products to take into account the above obligations; and
• list of underwriters and brokers provided to loanees to ensure that such a list is not limited to those on the bank’s panel.

Extension of new capital requirements

Implementation of new capital requirements providing for the higher of, a prescribed minimum or an amount reflecting the risk profile of an insurer, has been postponed to 30 June 2020.
The prescribed requirements are as follows:.

Recommendation: Insurance companies should take note of the new deadline and plan accordingly to ensure compliance.

Enhanced mandate of the IRA

The mandate of the IRA has been expanded in three key ways, namely;

• Regulating bancassurance: It is now clear that bancassurance falls under the regulatory ambit of the IRA.  
• Publications of Standards: formulating, publishing and enforcing standards for all insurance products including bancassurance.
• Consumer Protection and Education: required to educate the public regularly on the right to independently select a licensed underwriter or broker from an updated list of underwriters or brokers.

Recommendation      

Stakeholders should keep tabs on the IRA to ensure that they are updated once the IRA publishes insurance standards referred to in the amendments. 
Deadline for New Capital Requirements Extended to 30 June 2020.

Enhanced and new penalties under the Act

The penalties are as follows:

Recommendation: Stakeholders should take note of the enhanced/new penalties for contravening the Act to avoid the prescribed sanctions.