Between October 2014 and November 2015, Lombard Life, a subsidiary of South Africa-based Lombard Insurance Company, rejected 114 insurance claims.
However, in 86 instances, the notices sent to policyholders rejecting their claims did not inform them that they had 90 days to appeal the decision and the right to complain to the Financial Services Ombudsman.
South Africa’s registrar of long-term insurance referred the case to the FSB’s Enforcement Committee, which determined that a penalty of ZAR150,000 (£9,207, $11,458, €10,792) should be imposed.
In mitigation, the registrar took into account, among other things, that Lombard Life admitted the rule breach, cooperated with the investigation and subsequent enforcement action, and worked to prevent it reoccurring.
