COST AND COVER LIMITS
New credit life insurance rules beef up consumer protection
Credit life insurers will no longer be able to charge consumers exorbitant fees as new regulations published this week have put a lid on premiums. Trade and Industry Minister Rob Davies released final regulations prescribing the cost, cover and benefits of credit life insurance, which pays out in the event of a consumer dying, losing their job or becoming disabled while a credit agreement is in force. "The National Credit Act already regulates credit life insurance but does not prescribe limits on its cost, cover and benefits," said Lesiba Mashapa, company secretary of the National Credit Regulator, which drew up the regulations. The regulator has hauled furniture retailer Lewis to the National Consumer Tribunal for selling loss of employment and disability insurance to pensioners and self-employed consumers. Shoprite was also referred to the tribunal for selling this type of cover to pensioners and social grant recipients.
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