Regulatory Alerts2024-03-04
FSCA General Exemption for Microinsurers from Long-Term Policyholder Protection Rules
The Financial Sector Conduct Authority has published a general exemption allowing microinsurers to bypass Rule 2A.6.1 of the Long-Term Policyholder Protection Rules, which previously restricted their waiting periods to three months. This regulatory change permits microinsurers to implement up to six-month waiting periods for death, disability, and health events, thereby reducing adverse selection and aligning their pricing with traditional insurers. Subject to specific contractual conditions, the exemption serves as an interim measure to promote market competition and financial inclusion for low-income consumers while awaiting the full implementation of the Conduct of Financial Institutions framework.
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