Pan European solvency changes‚ called Solvency II‚ provided a foundation for the local changes‚ but reported conflict between Germany and France has pushed out the implementation of those rules to 2016.
The rules in SA‚ under the Solvency Assessment and Management regime (SAM)‚ are being adapted for local conditions and have entailed numerous technical discussions and reports with insurers.
Some insurers have complained that the changes could cost them hundreds of millions of rand. SA's long-term insurance sector has R1.74trn in assets under management.
Head of SAM at the FSB told the Association for Savings and Investment conference in Durban on Thursday (11 April) that the process had been delayed due to its complex nature.
He said it would require that insurance companies hold regulatory capital in line with their risks. Companies have complained that the costs of compliance will be exorbitant‚ with some suggesting that the figures could reach hundreds of millions of rand while the continuing costs could be as high as 5% of their cost base.
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