broker relationships

Currently under review, the proposed changes to conflict of interest legislation will bring about balance in a very competitive South African insurance industry. With players ranging in size and budget, the legislation aims to provide for a competitively neutral space for players to compete on an equal footing.

 

The strength of the MUA brand and our ability to compete regardless of immaterial financial matters, give us confidence that we will benefit from this new change, spearheaded by FAIS.

It is easy for some to assume that insurance offers presented to them are pure and without the intention to influence or persuade buying decision. However, this trust can be abused and often lead to entrapment where consumers are offered discounts for the placement of high volume business or broker schemes, which promote a conflict of interest.

 

The new legislation will enable consumers to take fair decisions on where or what type of business they would prefer to place with whichever player in the industry.

 

A practical example of how it may change the way insurance operators such as MUA deal with brokers is the new proposed allowable margin of R1 000 per individual per year for the purpose of entertainment.

 

A positive long term effect on sound corporate governance is expected to be the result and to the benefit of all role players.