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FAIS Ombud Dealing with complaints submitted to the Ombud for FSPs
An insurer repudiates Mrs Nel's claim for non-disclosure. She says her broker filled in the proposal form himself and left out the medical history she had given him. Which complaint falls within the FAIS Ombud's jurisdiction?
RE5 practice question with a worked answer. This is one of hundreds of FSCA RE5 questions in the RegulatoryExams question bank.
- a) Both complaints, because the FAIS Ombud deals with every dispute arising from an insurance policy.
- b) Her complaint against the insurer about the repudiation itself, because it concerns a financial product.
- c) Neither complaint, because a repudiated claim may be challenged only in a court of law.
- d) Her complaint against the broker, because it concerns how he rendered a financial service to her.Correct
Why this is the answer
The FAIS Ombud deals with complaints that an FSP or representative, in rendering a financial service, contravened the Act, acted wilfully or negligently, or treated the client unfairly, causing prejudice. The broker's completion of the form is such a service. A dispute with the insurer about its decision under the policy belongs to the insurance ombud scheme, not the FAIS Ombud.
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