Document background
The Loss Portfolio Transfer Agreement is a crucial document used in the South African insurance market when an insurer wishes to transfer a portfolio of insurance policies and their associated liabilities to another insurer or reinsurer. This type of agreement is particularly relevant in scenarios such as business restructuring, exit from specific insurance lines, or capital management optimization. The document must comply with the Insurance Act 18 of 2017 and other relevant South African financial sector regulations, including obtaining necessary regulatory approvals from the Prudential Authority. It typically includes detailed provisions for the transfer of reserves, claims handling procedures, data protection compliance, and ongoing reporting requirements. The agreement is essential for insurers managing their risk exposure and capital efficiency, while ensuring policyholder interests are protected in accordance with South African law.
