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Disclaimer: Crystal is provided for information purposes; it does not constitute solicitation of business and is not intended to be a substitute for appropriate professional advice. Information relating to Lloyd’s Brussels Subsidiary may be subject to regulatory approval.

South Africa * Lloyd's
* Please see Authorisation for details of Lloyd's underwriters licensing status
Please see Authorisation for details of Lloyd's Brussels licensing status

Pre-placement considerations

Authorisation

Lloyd's

Insurance

Lloyd's is licensed under the Short-Term Insurance Act 1998 to write insurance business in or from South Africa, with some exceptions. Lloyd’s licence does not permit the writing of:

  • Motor third party bodily injury liability covered by the Road Accident Fund (RAF) 
  • Workers' compensation   
  • Medical and funeral expenses
  • Life insurance or any business falling within the scope of the Long-Term Insurance Act 1998. Please see ‘more detail’ below for further information on Lloyd’s ability to write life insurance in South Africa.

Reinsurance

Lloyd's is licensed under the Short-Term Insurance Act 1998 to write reinsurance business in or from South Africa, except life.

Last updated: 14 Dec 2018


Definition of risk location

Lloyd's

A South African short-term insurance policy is defined as a short-term policy which relates to:

  • Risks in respect of immovable property, including buildings, fixtures and other fixed improvements, located in South Africa; or
  • Any other risks where:
    • The insured is a natural person resident in South Africa; or
    • In any other case, the insured has its registered office or principal office, or principal place of business in South Africa; and
  • Reinsurance contracts where the reinsured has its registered office in South Africa.

A 'short-term policy' is defined in Section 1 of the Short-Term Insurance Act 1998 ('the Act') as “an engineering policy, guarantee policy, liability policy, miscellaneous policy, motor policy, accident and health policy, property policy or transportation policy or a contract comprising a combination of any of those policies and includes a policy whereby any such contract is renewed or varied”. For the respective definitions of the above-mentioned policies, reference should be made to Section 1 of the Act.

Last updated: 07 Dec 2015

Examples of the definition of risk location for South African risks
Last updated: 07 Dec 2015


Compulsory classes

Lloyd's
The following classes are compulsory in South Africa:
  • Workmens' compensation.
  • Third party liability for commercial flight operators.
  • Oil pollution for tankers over 2000 tonnes.
  • Professional indemnity for pension fund trustees.
  • Professional indemnity and fidelity for Financial Service Providers.
  • Clinical trials for injury and damage.

Workers’ compensation is run by the state and motor third party bodily injury liability is handled by the government controlled Road Accident Fund, which is financed by a levy on petrol.

Last updated: 07 Dec 2015

Financial considerations

Exchange controls

Lloyd's
Exchange controls exist.
Last updated: 07 Dec 2015


Distribution channels

Coverholder business

Lloyd's

Lloyd's requirements for a coverholder carrying on South African business on behalf of a Lloyd's managing agent.

Binding authority held by a South Africa based coverholder

Last updated: 04 Dec 2017


Binding authority held by a coverholder based outside South Africa
Last updated: 04 Dec 2017


Binding authority held by a Service Company in South Africa
Last updated: 04 Dec 2017


Open market business

Lloyd's
This information is secured Secure item
Last updated: 07 Dec 2015

Intermediary regulation

Lloyd's
Financial Advisory and Intermediary Services (FAIS) Act 2002
Last updated: 04 Dec 2017


Short Term Insurance Act 1998
Last updated: 28 Feb 2018


Policyholder Protection Rules (Short-Term Insurance)
Last updated: 07 Dec 2015


Insurance documentation

Insurance documents

Lloyd's

Contract certainty applies to general insurance contracts either entered into by a UK regulated insurer (such as Lloyd’s underwriters) or arranged through a UK regulated broker (such as Lloyd’s brokers based in the UK).

Lloyd's has developed Quality Assurance (QA) checks to help the market comply with this requirement.

Further information on contract certainty can be found on the Market Reform website.

Last updated: 13 Feb 2019


Market Reform contract guidance

Lloyd's
This guidance on completing a Market Reform Contract (MRC) focuses on tax and regulatory checks.

It provides advice on completion of the Fiscal and Regulatory section, plus completion of headings in other sections relevant to fiscal and regulatory compliance.

The guidance below relates to insurance (ie not reinsurance).
Last updated: 07 Dec 2015


Language of contract

Lloyd's
Under South African insurance law it is not obligatory for policies to be in any particular language. 

It is recommended that policies and other insurance documents are in English unless the insured specifically requests an Afrikaans wording. It is also recommended that wordings in Afrikaans are professionally prepared and translated so that they truly reflect the parties' intentions.
Last updated: 04 Dec 2017

Choice of law

Lloyd's
To meet contract certainty requirements, the contract should contain a choice of law clause.

Short term insurance policies are governed by the law of the Republic of South Africa (This applies to both insurance and reinsurance).
Last updated: 07 Dec 2015


Jurisdiction

Lloyd's
The contract should include a clause recording the jurisdiction that will apply to the contract. The jurisdiction should be that of South Africa.
Last updated: 07 Dec 2015


Service of suit

Lloyd's
Insurance

It is not mandatory to include a service of suit clause.

However, it is strongly recommended that Lloyd's South Africa be nominated for service of suit. Where Lloyd’s South Africa is cited as a nominal party, the true party may, at any time before or after judgement, be substituted:
  • With the leave of the Court; or
  • On production to the registrar of the High Court or clerk of the magistrate’s court, as the case may be, of an affidavit setting out the true parties and their normal citation, if a copy has previously been furnished to the other party.

Reinsurance

There are no requirements for reinsurance business.

However, it is strongly recommended that Lloyd's South Africa be nominated for service of suit. 

Last updated: 07 Dec 2015


Representative(s)

Representative(s)

Lloyd's

Nathasha Wally, General Representative and Country Manager of Lloyd’s South Africa

Adelle Budricks, Compliance Officer and Deputy General Representative of Lloyd's South Africa 

Lloyd's South Africa (Pty) Ltd 
15th Floor
The Forum
2 Maude Street
Sandton 2196
South Africa

Tel: +27 11 505 0000
Fax: +27 11 505 0001

Email: nathasha.wally@lloyds.com, adelle.budricks@lloyds.com

Last updated: 25 Jan 2019