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Regulatory Bodies Short-term Insurance Twin Peaks

Which ONE of the following bodies is responsible for regulating the *market conduct* of short-term insurers in South Africa?

RE5 practice question with a worked answer. This is one of hundreds of FSCA RE5 questions in the RegulatoryExams question bank.

  1. a) The Prudential Authority (PA).
  2. b) Financial Sector Conduct Authority (FSCA).Correct
  3. c) The National Treasury.
  4. d) The Road Accident Fund (RAF).

Why this is the answer

Under the 'Twin Peaks' model, the Prudential Authority (PA) regulates the financial soundness (solvency) of insurers, while the Financial Sector Conduct Authority (FSCA) regulates their *market conduct* (how they treat clients, advertise, and sell policies) under the FAIS Act.

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