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Short-Term Insurance Act, 1998 (Act No. 53 of 1998)

Notice on Policyholder Protection Rules, 2004

Part IV: Rules on Void Provisions and format

5. Void Provisions

 

1) A provision of a policy is void to the extent that it provides expressly or by implication -
a) that in connection with any claim made under the policy, the policyholder may be obliged to undergo a polygraph, lie detector or truth verification, or any other similar, test or procedure which is furnished or made available by the insurer or any other person in terms of an arrangement with the insurer and which is conducted under the control of the insurer or such other person;
b) for an inducement of any nature for a policyholder to voluntarily agree to undergo a test or procedure envisaged in paragraph (a) of this Rule where the policyholder submits a claim under the policy;
c) that where a policyholder under other circumstances than those contemplated in paragraph (b) of this Rule voluntarily agrees to undergo a test or procedure envisaged in paragraph (a) of this Rule where the policyholder submits a claim under the policy, and the policyholder fails to pass such test, the claim will be repudiated or the policy will become void merely as a result of such failure to pass the test or procedure;
d) that in the event of any dispute arising under the policy, the dispute can only be resolved by means of arbitration;
e) that an insurer may reject a claim because a premium was not paid on due date, if payment was made during the period of grace referred to in Rule 7.5, whether or not the payment was made prior to the event giving rise to the claim.

 

2) Rule 5.1 (d) shall not be construed as rendering void a provision of a policy that the parties may, after a dispute under the policy has arisen, voluntarily agree to submit the dispute to arbitration or, in the absence of such a provision, as voiding any agreement between the parties to that effect.