|
To Subscribe please click
here |
 |
|
Investment Indicators - 23 April 2018 |
|
|
"We know what we are, but know not what we may be”
- William Shakespeare |
| |
|
|
Distributed to 52,023 subscribers.
To advertise with us
click here |
|
| |
 |
| Rates Review |
 |
|
1. Secured Investment Rates |
|
Please note that (G) indicates a Guaranteed and (L) a Linked product. In order to understand the difference between guaranteed and linked rates,
kindly click here for an explanation. |
|
|
|
|
|
 |
|
|
|
| |
Company |
This Week |
Last Week |
| 1 |
1Life (L) |
6.640% |
6.630% |
|
2 |
Clientéle Life (L) |
6.620% |
6.670% |
|
3 |
Absa (L) |
6.300% |
6.265% |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Company |
This Week |
Last Week |
| 1 |
Clientéle Life (L) |
6.720% |
6.770% |
|
2 |
1Life (L) |
6.640% |
6.630% |
|
3 |
Discovery (G) |
6.624% |
6.658% |
|
|
|
|
|
|
2. Money Market Funds |
|
|
|
Please bear in mind that our figures, though based on the actual quotations that you also use, are for information purposes only,
and can never replace the official quotation from the product house. In terms of the guarantees, you are requested
to clarify the exact extent of such guarantees with the product house prior to advising clients. |
|
|
|
|
|
 |
|
From the Crow's Nest |
 |
Proposed amendments to Premium collection
by Alan Holton |
As I mentioned in my previous article,
Draft Amendments on Premium Collection, a number of
significant amendments have been proposed to the Regulations to both
the LIA and the STIA.
A recent industry article dealt to some extent with the proposed
draft amendments to the STIA Regulations insofar as premium
collection is concerned. The article suggests that an issue with the
current method of premium collection is the perceived risk insurers
have when the IGF guarantee is insufficient to cover the outstanding
premiums. This risk, says the article, will be exacerbated when the
IGF guarantees are no longer available.
The article then suggests that there is a problem with premium
collection and proposes as a solution that premiums be collected and
paid directly into the insurer’s bank account.
This may lead to some confusion in the industry.
Insurers have always been entitled to insist that premiums be paid
directly into their own bank account. The implications inherent in
the article, however, are that this is now a requirement directly as
a result of the proposed repeal of the requirement that collecting
intermediaries hold IGF cover – and that there is no alternative.
Treasury however, are of the view that the repeal of the security
requirements could very well mean that an insurer will,
nevertheless, still require some form of guarantee or fidelity
insurance cover from an intermediary when allowing it to collect
premiums on its behalf. Insurers will do so in the interest of good
governance rather than as a consequence of a regulatory requirement.
Treasury released a “Statement explaining the amendments” (Annexure
E) in which they state that the intention of the amendment to the
LTIA Regulations is to provide more adequate protection to
policyholders and to align the legislative framework governing
premium collection across the LTIA and the STIA. Treasury says
further that, in addition to aligning the requirements relating to
premium collection in the LTIA and STIA, it is essential that the
regulatory framework for premium collection remains relevant to
current practices in the market.
There is no intention to interrupt current premium collection
practices – rather the intention is to improve policyholder
protection. There is no indication from Treasury that premiums must
now be paid directly to insurers. The proposed amended Regulations
are intended to improve the premium collection framework for the
entire insurance market and to compel insurers to have appropriate
oversight by independent intermediaries collecting premiums.
The following excerpt from the Treasury Statement is relevant to
these considerations:
“Due to the fact that the IGF requirements will be repealed from
Regulation 4 and because several significant risks regarding premium
collection have been identified in respect of the manner in which
insurance premiums are dealt with by independent intermediaries
collecting premiums (see Proposal E and F, 2014 RDR), it was deemed
necessary to improve the current legislative framework governing
premium collection. The proposed amendments therefore propose to
improve the premium collection legislative framework by, amongst
other things, including:
-
a prohibition on an independent intermediary delegating the
authority to collect premiums provided to it by a short-term
insurer;
-
requiring that certain matters must be addressed in the written
authorisation provided by the insurer to the independent
intermediary;
-
requiring that the independent intermediary collecting premiums
must maintain a separate bank account for the premiums collected;
-
prohibiting the independent intermediary from using the premiums
collected for any business or commercial purposes; and
-
imposing governance and oversight requirements applicable to a
short-term insurer when allowing an independent intermediary to
collect premiums.
It is acknowledged that some of the existing premium collection
arrangements between short-term insurers and independent
intermediaries will not be consistent with these amendments and such
arrangements will have to be restructured. Further, short-term
insurers that currently do not have appropriate oversight over the
functions performed by independent intermediaries in respect of its
current premium collection arrangements will have to set up
appropriate governance structures. Seeing that there is currently no
requirement in the LTIA Regulations governing premium collection,
National Treasury acknowledges that the new requirements with
regards to premium collection have the potential of having a
significant impact on the long-term and short-term insurance
industry.
Consideration will be given to appropriate transitional arrangements
necessary for some of the proposed amendments to mitigate the
possible impact thereof. Specific comment is invited from both
industries on what the cost and other potential implications of
complying with these new premium collection requirements will be,
and on transitional amendments necessary to facilitate the
implementation of these requirements.” (Emphasis added)
Alan Holton is an independent compliance officer and regular
consultant to Moonstone. |
|
|
|
|
|
 |
|
|
|
DISCOVERY INVEST CELEBRATES DECADE OF TOP PERFORMANCE
The
PlexusCrown survey for the fourth quarter of December 2017
saw Discovery Invest ranked as the fourth top CIS management company in
the country. The asset manager’s overall score shot up from 12th spot to
4th spot between March and December last year.
The Discovery Balanced Funds have provided consistent bench-mark beating
returns*. The
Discovery Balanced Fund enjoyed top quartile performance over one,
three, five, seven and ten years, with returns of 10.85%; 6.24%; 10.78%;
and 9.98% respectively to the end of February 2018. Pretty impressive,
and consistent, for a ten-year old.
Source: Profile Data, 28 February 2018
Disclaimer
This article is meant only as information and should not be taken as
financial advice. For tailored financial advice, please contact your
financial adviser.
Discovery Life Investment Services Pty (Ltd), branded as Discovery
Invest, is an authorised financial services provider. Registration
number 2007/005969/07.
Please
click here to read our full disclaimer .
|
|
| Your Practice Made Perfect |
 |
|
Don’t let good news headlines thwart your savings plans |
Positive sentiment in the country is being
fuelled by a change in political leadership, the stronger rand, a
higher-than-expected GDP growth rate and a more optimistic consumer
outlook. The latest decision by ratings agency Moody’s to keep South
Africa's sovereign debt at above investment grade and revise its outlook
from negative to stable, confirms this.
But, says Rob Formby, chief operating officer designate at Allan Gray,
while the current mood is indeed good news for South Africans, investors
should not let this distract them from continuing to tighten their
belts.
“These good news headlines are a relief for many South Africans, but the
reality is that a lot of work is required to fix the economy and the
country. South African investors should not make changes to their
long-term savings plans based on the recent euphoria alone,” says
Formby.
Despite the recent interest rate cut, a Value Added Tax (VAT) hike – the
first increase in the country since 1993 – coupled with the
below-inflation increase in the bottom three personal income tax
brackets and no inflation adjustment to the top four tax brackets, will
see people out of pocket.
“Amidst this climate, we should still look at frugality as the new
normal, adopt a savings mentality where possible, and look for ways to
rein in spending,” he says, adding that going back to investing basics
in 2018 will help investors stick to their plan.
“Investors should focus on spending less money than they earn, saving
wherever their budget allows, and starting as early as possible.”
A recent report released by Lloyds Banking in the UK is calling for 2018
to become known as the year of savvy spending: It claims that, an
astounding, 50% of people have changed their spending habits since the
start of the year.
“South Africans would do well to follow this trend,” Formby notes.
Formby further reminds investors not to make sudden changes to their
portfolios in response to the news headlines.
“Investors often lose out on performance when trying to adjust their
investments based on day-to-day news and events. It makes far more sense
to base investment decisions on what you need to reach your goals, and
then stick with the plan,” he concludes.
Share the article with your clients –
click here to download pdf version. |
|
|
|
|
|
 |
| |
|
Setback for home loan defaulters
|
An article on the rights of home loan defaulters was recently
published on the GroundUp website. Below is a summary from Legalbrief
Today on the matter.
In a setback for home loan defaulters, the Gauteng High Court (Pretoria)
recently dismissed a challenge against the constitutionality of certain
rules of court which enable the home of a debtor to be sold without a
reserve price. The primary issue the court had to determine was the
constitutionality of rule 46(12) of the High Court rules which enable a
creditor to attach and sell a debtor’s home without a reserve price
being set. Under this rule, it is possible for the bank to sell a
debtor’s home for any price and recover any amount they can for the
outstanding debt, notes a GroundUp report examining the judgment.
In reaching its decision, the court dealt with four main issues –
-
will a reserve price result in a home being sold for a higher price;
-
does a sale without a reserve price constitute an arbitrary
deprivation of property;
-
does the fact that the rules were subsequently amended mean that the
previous rules were defective and
-
does the rule infringe upon the right to adequate housing?
Among other things it found that because there is judicial oversight
over the process of determining whether a house is specifically
executable before a warrant of execution is issued, the right to
adequate housing is already protected. As such, there was no need for
further protection in the form of a reserve price. It also decided the
question of whether a reserve price should be set or not is in fact a
policy decision which is best left to Parliament to determine.
The report notes that although the amended version of the rules, which
came into effect in December 2017, enables a reserve price to be set in
certain circumstances this is still not the default position. Debtors
whose homes were attached prior to the amended rules will still be in a
potentially precarious position. For this reason, Lawyers for Human
Rights, intend to appeal.
Full GroundUp report
Judgment. |
|
|
|
| |
 |
|
Regulatory Examinations |
 |
|
Latest on study material |
|
We are still inundated with enquiries about “the new” INSETA study
material.
There is no NEW study material. Only a small section is affected
by the new Fit and Proper regulations, as outlined in the latest
Preparation Guide.
It is therefore important that learners familiarise themselves with this
document which contains the amended qualifying criteria and tasks.
According to the Inseta website, the amended Inseta training manual will
be available from the middle of May onwards.
Click here to download the latest Preparation Guide.
|
|
|
|
| |
|
How can using the Preparation Guide help me prepare? |
Candidates should not find it difficult to prepare for the exam
because the
Prep Guide outlines exactly what the examination will be testing
and where to find the information. Studying the Prep Guide is in fact
the very first step a candidate should take to ensure that he or she
knows what they have to know, and where to find the required
information.
For Example:
Task
no |
Task |
QC |
Qualifying
Criteria |
Knowledge
(K) or Skill
(S) |
Legislation
Reference
Where in the legislation
is this task and criteria covered that must be
studied. |
|
7 |
Dealing with complaints that have been submitted
to the Ombud for FSPs |
1 |
Explain the role and authority of the Ombud for
FSPs |
K |
FAIS Act - Sec 1 Definition of Complaint
FAIS Act - Sec 20(3)
FAIS Act - Sec 20(4)
FAIS Act - Sec 27 & 27(3) & 27(4)
FAIS Act - Sec 28
FAIS Act - Sec 28(4)(a)
FAIS Act - Sec 31
BN 81 of 2003 - Sec 3
BN 81 of 2003 - Sec 4(c) |
In the
Preparation Guide the FSCA shares 6 steps that will work
most effectively for examination preparation:
Step 1: Refer to the mapping document for the exam
you are planning to write. (Appendix A in the Preparation
Guide)
Step 2: Look at the number of criteria for each task
(RE 1 has 16 tasks that will be tested RE 5 has 8 tasks that
will be tested).
Step 3: To prepare for the exam, you must spend time
each day and study the legislation and supporting training
material. One should systematically select one criteria at a
time. (allocate study hours per day to prepare)
Step 4: To start, read the task, and then the first
criteria. Then refer to the legislation for these criteria,
and read the legislation referred to.
Step 5: Now refer to the additional support or
training material (for example the INSETA training material)
and study the section in the training material dealing with
those particular criteria.
Step 6: Then go back to the legislation itself, and
read it again. |
|
|
|
| |
|
2018 Schedules updated |
|
(next UK opportunity is on 1 October 2018)
Registration page
Please note: Registration cut-off is 11 working days before date of exam.
|
|
|
|
|
Careers Platform
|
|
Are you hiring? Advertise your position on Moonstone’s Career Platform
|
| • |
The Moonstone website -
www.moonstone.co.za
- enjoys an average of 20 000 visits and approximately 39 000 page views per month. |
| • |
Moonstone boasts an exclusive newsletter mailing list of over 51000
dedicated financial decision makers who receive 2 newsletters per week. |
| • |
Our audience is relevant and industry specific: individual and corporate advisors and brokers in the following financial sectors:
iInvestment, Risk, Healthcare, Banking, Retirement, and Insurance. |
|
|
|
|
| |
|
Featured Positions |
-
Broker Consultant:
CIA - Commercial & Industrial Acceptances, KZN Umhlanga - We are
looking for a candidate with at least 5-10 years working experience in
the insurance industry, short term insurance qualifications and RE1.
Read More
-
Offshore Property
Consultant:
Salesforce Recruitment Johannesburg and Durban - This is your
opportunity to offer a unique, capital growth investment opportunity to
the market without bumping heads with direct competitors.
Read More
-
International Buy to
Let Sales Consultant:
Salesforce Recruitment Johannesburg and Durban - Join this stable,
Offshore Property Investment House and elevate your sales career to the
next level.
Read More
-
Key Individual:
Destinata Capital Ltd, Faerie Glen, Pretoria & Somerset West - We
have a position for a key individual who is licensed for at least
category 1.8.
Read More
|
|
|
|
|
In Lighter Wyn |
 |
|
Great thoughts |
|
|
|
|
|
|
Tel: +27 21 883 8000 | Fax: +27 21 883 8005
info@moonstoneinfo.com
www.moonstone.co.za
P.O. Box 12662, Die Boord, Stellenbosch, 7613, Republic of South Africa
Disclaimer:
Services and products advertised by external product suppliers in
this newsletter are paid for by the respective suppliers. Moonstone
does not endorse any opinions, conclusions, data, products, services
or other information contained in this e-mail which is unrelated to
the official business of Moonstone and furthermore accepts no
liability in respect of the unauthorised use of its e-mail facility
or the sending of e-mail communications for other than strictly
business purposes.
The complete disclaimer can be accessed
here. |
|
|
©2015 Moonstone. All rights reserved. |
| |
