Namibian insurance companies and medical aid funds have been directed to offer clients payment holidays, and to continue processing claims and treating defaulters as subscribers until the COVID-19 pandemic is over.
The Namibia Financial Institutions Supervisory Authority (Namfisa) issued this order which was announced by its CEO, Mr Kenneth Matomola, reported The Namibian.
Mr Matomola also said that despite tough economic conditions, non-banking financial institutions (NBFIs) remain financially sound with adequate capital buffers to absorb shocks.
Therefore, the regulator is directing the insurance industry, medical aid funds (that is, health insurance funds) and asset managers to roll out various relief packages to meet the needs of struggling households and companies.
“The authority requires NBFIs to offer immediate relief to consumers based on varying business models and product features, but without compromising the financial soundness of the institutions,” Mr Matomola said, adding that relief should only be granted to consumers directly impacted by the pandemic.
Long-term insurance companies have been directed to offer premium holidays to their clients with the possibility of extension if the country fails to flatten the curve of virus infection and the current lockdown continues.
In the event that a claim occurs during or after the period, Mr Matomola said the outstanding premiums should be deducted from the claim amount.
For savings, investment and retirement annuity policies, as well as clients asking for payment holidays, policies should be treated as paid up. The normal terms can be reinstated after a period determined by the insurer has lapsed.
Mr Matomola added no penalty should be imposed or extra costs added for clients because of missed premiums.
He said with regards to short-term insurance, the same cover should be extended to clients working from home as the cover for working at business premises to enable work-from-home policies during the state of emergency.
Motor accident claims when vehicle licences have expired during the COVID-19 lockdown should also be accepted. Extensions should be considered when policies are deemed to have lapsed for the duration of the state of emergency, he said.
Mr Matomolo said medical aid fund members should be allowed to downgrade their benefit options during the course of the year although ordinarily they are only permitted to change options at the beginning of the year. This is to enable affected members to downgrade to more affordable benefit options.
The medical aid funds are also urged to provide benefits in respect of all COVID-19-related claims such as for laboratory tests, consultations and hospitalisation, or any other related treatment.