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LICENCE CONVERSION PROCESS

3RD PARTY CLIENT WORKSHOP

DATE: 28 NOVEMBER 2018

PRESENTER: MAXWELL SIBANDA (CRO)

INDEX

INTRODUCTION AND BACKGROUND

PROGRESSIVE IMPLEMENTATION

4 GUIDING PRINCIPLES OF PROCESS

ISSUING OF LICENCE CERTIFICATES

STATUS OF GUARDRISK CONVERSIONS

CONCLUSION AND WAY FORWARD

SLIDE NO: 2

7 STAGES OF CONVERSION PROCESS

INTRODUCTION & BACKGROUND

INTRODUCTION AND BACKGROUND

Conversions of registrations (LT or ST Ins Acts) to licences (Ins Act).

Comm. 2 sets out process to be followed by Prudential Authority (PA).

Applies to all insurers registered before 1 July 2018 (LT & ST Ins Acts).

Communication 2 of 2018 (issued under the Insurance Act 2017).

SLIDE NO: 4

PROGRESSIVE IMPLMENTATION

PROGRESSIVE IMPLEMENTATION PROCESS

SLIDE NO: 6

PHASE 1

01 JUL 18 – 01 JAN 19

Conversion of registrations o f d o r m a n t i n s u r e r s , i n su re rs th at wa nt to become microinsurers and insurers that are, or want to become cell captive insurers

PHASE 3

01 OCT 19 – 31 JUL 20

Conversion of registrations of insurers other than those referred to in Phases 1 and 2

PHASE 2

01 JAN 19– 01 OCT 19

Conversion of registrations of captive insurers, insurers only conducting reinsurance & insurers conducting only linked insurance business

The PA must within a period of two years after the effective date of the Act, convert the registration of all previously registered insurers to a licence in accordance with the Insurance Act.

4 GUIDING PRINCIPLES OF PROCESS

PROGRESSIVE IMPLEMENTATION PROCESS

SLIDE NO: 8

PRINCIPLE 1

CERTAINTY

PRINCIPLE 2

CONTINUITY

PRINCIPLE 3

STABILITY PRINCIPLE 4

IMPROVE, GROW & REGULARISE THE SECTOR

7 STAGES OF CONVERSION PROCESS

STAGES OF THE CONVERSION PROCESS

SLIDE NO: 10

STAGE 1

Submit draft conversion workbook

STAGE 2

Pre-conversion engagement

STAGE 3

Submission for conversion

STAGE 4

Consideration of submission for

conversion

STAGE 5.A

Pre-conversion engagement

STAGE 5.B

Independent expert view (if necessary)

STAGE 6

Issue of notification on license converting

previous registration PA intends to issue

STAGE 7

Issue of licence

ISSUING OF LICENCE CERTIFICATES

WHEN WILL INSURER RECEIVE LICENCE?

Due to parliamentary delays, certain requirements not in place by Jul 18.

No new licence can be finalised if conduct-related legislative framework is still not yet in place (conversion may be concluded - but licence wont be issued).

Reg framework is an integrated i.e. prudential and conduct framework.

SLIDE NO: 12

In order to implement Insurance Act & Prudential Standards, certain amendments to the subordinate conduct-related legislative framework (Regs & PPRs) made under the ST & LT Ins Acts needed to be made.

STATUS OF GUARDRISK CONVERSIONS

STATUS – GUARDRISK LICENCE CONVERSION

SLIDE NO: 14

STAGE 1

Submit draft conversion workbook

STAGE 2

Pre-conversion engagement

STAGE 3

Submission for conversion

STAGE 4

Consideration of submission for

conversion

STAGE 5.A

Pre-conversion engagement

STAGE 5.B

Independent expert view (if necessary)

STAGE 6

Issue of notification on license converting

previous registration PA intends to issue

STAGE 7

Issue of licence

CONCLUSION & WAY FORWARD

CLOSING COMMENTS & WAY FORWARD

Guardrisk submitted initial workbooks beginning Oct 2018.

Guardrisk awaiting engagement & next steps (from PA).

Engagements/agreement with the PA will dictate way forward.

Guardrisk process commenced end Aug/beginning Sep 2018.

SLIDE NO: 16

Thank you