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Moonstone Monitor -  3 May 2018
In This Week's Newsletter
 
From the Crow's Nest
FAIS Ombud - New incumbent well qualified for challenges
 
Your Practice Made Perfect
Ombudsman for Short-Term Insurance annual report - 9 962 complaints were resolved in an average turn-around time of 131 days
Moonstone Compliance Workshops – save the dates
Class of Business Training – register today!
 
Technologically Speaking
Social media engagement – what to push to clients
 
Regulatory Examinations
RE Deadline 30 June 2018 – Considerations for those affected
How to prepare for the REs – FSCA guidelines
Updated Inseta RE study material – Now available to download
Schedules for 2018
Frequently Asked Questions
 
Careers Platform
Are you hiring? Advertise your position on Moonstone’s Career Platform
Featured Positions
 
In Lighter Wyn
Social media and tech explained
 
 
 
 
 

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From the Crow's Nest
From the Crow's Nest
FAIS Ombud - New incumbent well qualified for challenges
A media release from the office of the FAIS Ombud reads:

“I am pleased to announce the newly appointed Ombud for Financial Services Providers, Mr Naresh Tulsie. Mr Tulsie will take over from Ms Noluntu Bam effective 1 May 2018.

Mr Tulsie is an Admitted Attorney and holds a B.Comm, LLB and LLM degrees with specialisation in Insurance Law.

After practicing as an attorney, Mr Tulsie joined Guardian National during 1997 where he was employed as a Senior Legal Advisor. He joined the Office of the Ombudsman for Short Term Insurance as an Assistant Ombudsman during 2000 where he remained until 2007.

Mr Tulsie further acted as Legal Director and Group Legal Advisor at the Badger Group of Companies from 2007 to 2013.

He was appointed as Head of Compliance for Nedbank Insurance (short term) during December 2013. From July 2015 until 30 April 2018 he served as the Legal Manager for Nedbank Insurance.

Mr Tulsie is committed to his new venture as the FAIS Ombud and will continue to work towards protecting consumers, strengthening the integrity of the financial services industry and building relations with all stakeholders.”

Comment

It is heartening to note the new Ombud’s extensive industry experience and insurance law qualifications which will stand him in good stead in what has always been a very important part of the regulatory environment.

The office of the Ombud has always provided practical application/interpretation of complex legal matters. Outcomes based legislation will offer a far bigger challenge than the rules based version his predecessor had to contend with.

Objectives of the FAIS Ombud

The chairman of the Short-term Ombud’s Board, Mr Haroon Laher, writes in the latest annual report:

“…OSTI’s purpose cannot be simply to resolve complaints in the fastest time possible. Nor is it OSTI’s purpose to resolve complaints by accurately applying the law. An important and perhaps sometimes overlooked aspect of its purpose is to resolve complaints on the basis of what is fair. Fairness is a somewhat nebulous concept and what is or is not considered fair differs from person to person. Often, the more formality that is applied to the resolution of a matter, the less fair the outcome seems. If OSTI is able to assist consumers and insurers in identifying and focusing on the real underlying issues, and it can get these issues resolved quickly and informally, and without recourse to the application of stringent legal principles, everyone wins. That is the overarching purpose of OSTI.”

The FAIS Ombud website says its objective is to “…consider and dispose of complaints by clients against financial services providers. The process is procedurally fair, informal, economical and expeditious and its foundation is equitable in all circumstances.”

Challenges facing new Ombud

Staff morale:

Recent reports in the Citizen concerned complaints from staff members to the Public Protector about perceived ‘unethical, unprofessional and abusive conduct towards staff members’”. The then FAIS Ombud referred the article to the Press Ombud who rejected the complaint.

Productivity:

The latest FAIS Ombud Annual Report clearly indicates a huge need for revision of current practices. While the increase in complaints is lauded by all, the fact remains that, of the 10 846 complaints received, 8 433, or 77.8% were either dismissed or referred to alternative forums. In the 2016/2017 year, only 1005 settlements were reached, and 68 determinations made. Most of the latter involved mothballed property syndication cases which had already been partially investigated.

Procedural Matters:

Criticism of the Ombud’s office came from the FSB Appeal Board, normally chaired by a retired judge. In the Prigge case, it stated:

“It is not known why the Ombud is unable to deal with matters expeditiously but one can gather from the file that much time and effort is spent on side issues and one knows from experience that the determinations are not concise and to the point.”

From the same case:

“Matters like this (there are other instances) add fuel to the allegation that the Ombud is biased against financial service providers and sees her role as champion of disappointed clients.”

Later reviews from the Appeal Board noted similar actions, including the Waterboer case heard on 27 February 2018 where the Appeal Board noted that “…the Ombud failed to deal with the matter expeditiously or in a procedurally fair manner.”.

Potential remedies

Under the Financial Sector Regulation Act, an Ombud Council will act as an overseeing body which will promote the awareness, accessibility and use of the entire ombud system, and take steps to improve its effectiveness, including imposing common standards of best practice and promoting cooperation and coordination amongst ombuds. The Ombud Council will oversee all ombud schemes, becoming a “regulator” of ombuds, including making calls on jurisdictional disputes.

In addition, the Financial Service Tribunal will replace the Appeal Board and make decisions emanating from applications for the reconsideration of FSCA decisions, including Ombud decisions.

Conclusion

In theory, it appears that we are heading for better times in terms of problems experienced in the past. Those entrusted with making this happen will have to traverse uncharted territory to make it work for all concerned.

Bon voyage.
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Your Practice Made Perfect
Your Practice
Ombudsman for Short-Term Insurance releases annual report
The Ombudsman for Short-Term Insurance (OSTI) recently released its Annual Report on Operations for 2017. Key highlights for the year are that 9 962 complaints were resolved in an average turn-around time of 131 days with an amount of R87 101 354 recovered for consumers.

Of the 9 962 complaints finalised by OSTI during 2017, the highest category of claim-type was motor vehicle claims at 49% followed by homeowners claims at 20%. Commercial claims contributed 7.9% to the total and household content claims, 6.2%.

Ombudsman, Deanne Wood pointed out that “it’s not surprising to report that 61% of complaints under homeowners insurance related to storm damage and other acts of nature”.

Theft and burglary claims amounted to 73% of the claims under household content insurance. Under commercial insurance 28% of complaints related to building claims and 25% to motor vehicle claims.

Click here to download the detailed report.
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Moonstone Compliance Workshops – save the dates
Moonstone Compliance and Risk Management’s comprehensive, practical workshops, will run in June 2018.

This year our workshops will be accredited by a recognized body and will qualify as a CPD activity towards the accumulation of CPD hours as required by the FSCA.

The workshops will again be facilitated by Billy Seyffert and Alan Holton and will cover:
 
A concise overview of:
  The Insurance Regulations, the impact and what’s next?
  The most important Policyholder Protection Rules considerations
  Debarments – What has changed?
  Financial Sector Regulation Act – What is important to me?
The proposed changes to the General Code of Conduct and the impact on FSPs
An in-depth unpacking of the 12 elements of the New Fit and Proper Requirements and what it will take to comply.

The workshops will run from 09h00 until 13h00 and take place on the following dates and venues:

VENUE DATE
East London - EL Golf Club 5 June 2018
Port Elizabeth - PE Golf Club 6 June 2018
Cape Town - The River Club 18 June 2018
Johannesburg - Houghton Golf Club 19 June 2018
Pretoria - Diep in die Berg 20 June 2018
Durban - Coastlands Hotel Umhlanga 21 June 2018
Bloemfontein - Emoya Estate 26 June 2018

Registration is scheduled to open next week. Details will be contained in our newsletters.

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Class of Business Training – register today!
The Act stipulates that a FSP and representative must complete the class of business (CoB) training relevant to those financial products for which they are authorised prior to rendering any financial service in respect of such products.

A key individual must, likewise, complete the CoB training in respect of the classes of business for which he/she is approved to act as key individual prior to managing the rendering of any such financial services.

Who should attend Class of Business training?
  • All FSPs, Key Individuals and Representatives appointed after 1 April 2018.

  • FSPs, Key Individuals and Representatives who seek authorisation, approval or appointment for new financial product categories after 1 April 2018.

  • Representatives working under supervision as at 1 April 2018, or appointed under supervision after 1 April 2018.

  • Certain exemptions apply, depending on the type of business one does, and how it is conducted. Please contact your compliance officer if in doubt.

Who is exempt from Class of Business training?

FSPs, KIs and Reps, authorised prior to 1 April 2018 are considered to have completed the CoB training in view of their past experience and are therefore exempt from CoB training, unless they add new products to their licence.

By when?

A Rep working under supervision on 1 April 2018, or who is appointed under supervision between 1 April and 31 July 2018, has until 31 July 2019 to meet the CoB training requirements.

As things currently stand, appointees from 1 August 2018 onwards are not included in this transitional arrangement, and will not be allowed to conduct business prior to the successful completion of the CoB training.

Who may offer training according to the Act?

Training must be provided and assessed by a Quality Council accredited educational institution. It is therefore very important that you verify this prior to contracting with any training service provider.

Moonstone Business School of Excellence (MBSE) is a duly accredited institution and will provide training in all nine CoB modules stipulated in the Act. This link also contains details of the various sub-classes of business.

Format of Training

In order to keep costs down, and cause the least amount of interruption in your business, CoB training will initially be conducted in e-learning format.

More information

Visit the Class of Business page on the MBSE website: http://www.mbse.ac.za/qualifications/class-of-business/

If you require more information regarding the fees and implementation dates please contact Veronica Grobler on 087 702 6429 or at veronica@mbse.ac.za.

For information on Corporate Packages, please contact Sheila Olckers on 021 883 8000 or SheilaO@moonstoneinfo.com.
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Technologically Speaking
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Social media engagement – what to push to clients
A recent international study found that what advisors and corporate marketing teams push to clients may not be what clients and followers engage with most. The Hearsay study viewed social media and content from three views: what clients or followers prefer, what corporate marketing teams produce, and what wealth advisors, as well as insurance and property/casualty insurance agents, push out.

According to Abhay Rajaram, vice president of customer success at Hearsay, the study found some disconnects and surprises. The traditional rule of the 70/20/10 [lifestyle/industry/corporate] best practice that the marketing industry promotes simply doesn’t apply in financial services area.

Based on their findings Hearsay recommended several best practices for both corporate marketing teams and advisors and agents, including:
  • Put an entertaining, engaging spin on industry and corporate content, such as how-tos, what’s new, personal stories of success and inspirational quotes.

  • Share more lifestyle content, which is what most engages followers. This includes popular trends and obvious and obscure holidays.

  • Leverage automation and industry-specific technology to make it easier to publish the right content at the right time.

  • Keep an open dialogue between corporate marketing teams and the advisory field.

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Regulatory Examinations
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RE Deadline 30 June 2018
The table below indicates who has to successfully complete the RE 5 by 30 June 2018.
 
Representatives’ DOFA RE 5 Deadline
30/06/2015 – 31/12/2015 30/06/2018
01/01/2016 – 29/06/2016 30/06/2018
30/06/2016 – 31/12/2016 30/06/2019

DOFA refers to your date of first appointment. For instance, if you were appointed on 1 September 2015, you actually have two years and nine months in which to pass the RE 5 for representatives.

Unfortunately, time is now running out for those who are compelled to pass in less than two months.

  1. Remember that bookings close about two weeks before the actual exam, for logistical reasons. For instance, yesterday we closed bookings for 17 May.

  2. Not everyone passes at the first attempt. If you wish to give yourself enough time to re-register in such an event, bear in mind that you should allow for time for your paper to be marked and the results sent to you. This means that you should try and write by 8 June, given that our venues have always been fully booked in the last few weeks of the DOFA deadline.

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How to prepare for the REs
The FSCA Preparation Guide recommends the following approach:

 
STEP ACTIVITY DESCRIPTION
1 Refer to the mapping document for the exam you are planning to write. This is the map of the tasks/criteria that will be assessed in your exam, and it contains a reference to the relevant legislation that you are required to study in order to understand the task / criteria. Appendix A in the Preparation Guide
2 Look at the number of criteria for each task. These are the knowledge and skill components you require to be able to perform.
RE 1 has 16 tasks that will be tested
RE 5 has 8 tasks that will be tested

If you have studied all the criteria for every task, then you would be properly prepared to write the RE1 or RE5 – whichever exam applies to you.
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. Group the criteria together in groups of 3 or 4 and allocate study hours per day to prepare. The total number of hours will individually differ due to ones circumstances. At least 2 hours per day is the suggested number of hours.
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. It is important to first read the legislation so that you can see what terms are used and how the legislation is structured.
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. The support material explains the particular concepts in simple language so that it is easier to understand what the legislation is actually saying and what it means.
6 Then go back to the legislation itself, and read it again. Now that you have gained a better understanding of what the legislation is about, you may find reading the legislation again will make more sense to you if you didn’t understand it the first time around.
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Updated Inseta RE study material – Now available to download
We recently had a sneak preview of the new RE Learning Material produced by BANKSETA.

BANKSETA revised the RE Learning Materials that was originally developed by INSETA in 2014 as a result of the amended requirements contained in the 2017 Determination of Fit and Proper Requirements that impacted the content of the study material.

Some immediate observations are that that its written in a user friendly manner, upfront informs the reader what legislation to have on hand, the table of contents serves as a good reference guide and the critical learning outcomes are clearly mentioned.

How to access the latest training material?

Click on this INSETA link to go directly to the registration page.
Once you have completed the required information, you will be given access to the Inseta RE 1 and RE 5 study material.

Alternatively, you can download the RE 5 (reps) and RE 1 (key individuals) material directly from the Moonstone website by clicking on the required link.
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2018 RE Schedules updated

Please note
: Registration cut-off is 11 working days before date of exam.
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Careers Platform
Are you hiring? Advertise your position on Moonstone’s Career Platform
Careers Platform Packages

•   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: Investment, Risk, Healthcare, Banking, Retirement, and Insurance.


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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

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In Lighter Wyn
In Lighter Wyn
Social media and tech explained

Social media explained


Life before the computer
 

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