The amendments to the commission regulations are due to take effect one month after the effective date of FAIS, and commercial lines commissions will be decapped on 30th October 2004.
The FSB have advised the South African Insurance Association (SAIA) that they have approved an extension of this date for the life insurance industry.
Theyarealsowilling to consider a similar extension for the short-term insurance industry, if a request was submitted and motivated through the Association.
The SAIA board agreed to approach the FSB to request a delay of the implementation date for the decapping of commissions until 1st January 2005, to allow for the finalisation of necessary system changes.
With regards to deregulation, broker organisations have advised the SAIA that there is a ground swell of support.
Specifically for maintaining the commission levels currently experienced for some time after decapping of commission takes place, and that whatever changes occur after the decapping should happen in an orderly fashion.
The broker associations have pointed out that where deregulation took place in other countries, the resultant change took place very slowly, and there is a view that the South African industry should take the same approach.
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