Category Life Insurance

Court rules

29 April 2004 Angelo Coppola

Part two of the dispute starts in April 2003. Part 1 is the background to the dispute, distributed via email newsletter.

During April 2003 Assupol notified Rentmeester of the number of replacement policies accepted by Assupol and requested Rentmeester to remove these policyholders from Rentmeester's system.

Rentmeester challenged the validity of the replacement policies and rejected the notification received from Assupol.

The result of the dispute was that both insurers were claiming premiums payable by those policyholders.

The pension payment facilitators felt uncomfortable with the double request for premiums and decided to keep all premiums in a trust account.

Claims were however being paid by the insurers on a practical basis in respect of these policies.

The Registrar of Long-term Insurance was not comfortable with the pension payment facilitators keeping premiums in trust without being registered long-term insurers.

In agreement with all the interested parties the trust accounts of the pension payment facilitators were transferred into a trust account under the control of the Financial Services Board.

The Registrar of Long-term Insurance went out of his way in an effort to solve the problem, through numerous meetings, an inspection and other methods.

As no settlement could be reached between Assupol and Rentmeester, the Registrar of Long-term Insurance decided to approach the high court.

The High Court ruled that the management and control of this disputed business, i.e. that part of the business of Assupol and Renmeester:

a. which is in dispute between the said parties; and

b. in respect of which the said two parties are exercising concurrent claims to premiums; and

c. in respect of which premiums are kept in trust by the Financial Services Board,

have been made the responsibility of Nico Fourie from 22 April 2004.

Fourie will administer the business and is also responsible for recommending a reasonable and pragmatic allocation of the disputed policies and the premiums thereto between Assupol and Rentmeester.

Fourie will perform his functions under the supervision of the Registrar of Long-term Insurance, and will also have to submit a report to the court by 27 July 2004.

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