60 not 40 days’ notice to FSB to end binders

Regulation 6.6 of the Short-term Insurance Act requires an insurer to give notice to the Financial Services Board (FSB) 60 days before the termination date of a binder agreement (the form of the notice is in Annexure A of Directive 151).

Directive 151 mistakenly stipulates that notice must be given 40 days before the termination date. The FSB has confirmed that 60 days is the correct period. Regulations take precedence over directives.

First published by : Financial Institutions Legal Snapshot