Insurers And The Consumer Protection Act

The Short-term Insurance Act is exempt from the provisions of the CPA for a period of 18 months until 1 October 2012. Those insurance sector lows must be aligned with the consumer protection measures in the CPA or the provisions of the CPA will apply to insurers. The CPA protects, as consumers, all individual natural persons and small business with assets or annual turnover less than R2 million.

On a permanent basis, advice or intermediary services provided by or on behalf of insurers under the Financial Advisory and Intermediary Services Act are exempted entirely because the FAIS Act already provides adequate consumer protection.

There are many provisions in the Consumer Protection Act that will need careful consideration when insurance laws are aligned in October 2012. Shifting of risk, disclaimers and exemptions are presumed to be unfair unless in the circumstances they are shown to be fair certain disclaimers and exemptions are either unfair or need to be drawn