[Image] Client Protection

Financial Advisory and Intermediary Services Act (FAIS)

Your money is valuable to you, and deciding who should advise you on your investments is not a decision you should take lightly. This Act aims to protect you, the client, by prescribing how financial services, i.e. advice and intermediary services, in respect of your policy or investment should be rendered to you. The FAIS Act regulates the financial services industry to the extent that it requires advisers to have licences in order to operate lawfully. Momentum has committed itself to deal only with intermediaries who are licensed by the Financial Services Board under the FAIS Act.

The FAIS Act also requires intermediaries to carefully consider which product is suitable for their client and to provide service in an honest, fair way with due skill and care.

Under the general code of conduct for authorised financial service providers (FSPs) under the FAIS Act, you are entitled to a great deal of information from your intermediary.Your intermediary is obliged, in terms of FAIS, to disclose fully and accurately information that may affect your decision to conclude a contract or not to do so. The information that your intermediary must provide to you includes information about the product supplier, the intermediary and the financial service (the product). We list some of the more important points below.

Information about the product supplier

  • Name, address and contact details.
  • Names and contact details of the compliance and complaints departments.

Information about the intermediary

  • Full business and trade names, address and contact details.
  • Details of the legal and contractual status of the intermediary and the intermediary's contractual relationship with the product supplier and services providers.
  • Details of the financial service that the intermediary is authorised to provide under the relevant FSP licence, as well as any conditions or restrictions that apply to this.
  • Whether the intermediary holds guarantees or professional indemnity or fidelity insurance or not.
  • Any conditions or restrictions that the insurer/s imposed on the types of financial products or services that the intermediary may provide.
  • Any personal interest that the intermediary may have in the financial service, as well as any conflict of interest.

Information about the financial service

  • General explanation of the nature and material terms of the relevant contractor transaction; name and type of the financial product and the nature and extent of the benefits.
  • Material contractual information, illustrations, projections or forecasts.
  • Any charges and fees to be levied against the product, including the amounts, and their frequency to enable the client to determine the net investment amount.
  • Nature and extent of monetary obligations that the client assumed, directly or indirectly, in favour of the insurer and in favour of the intermediary.
  • Nature, extent and frequency of any incentive, remuneration, consideration, commission, fee or brokerage that any insurer has to pay to the intermediary or for which the intermediary may become eligible, as a result of rendering of the financial service.
  • Details of any special terms or conditions, exclusions or liability, waiting period, loadings, penalties, excesses, restrictions or circumstances in which the insurer will not provide benefits.
  • Details of any guaranteed minimum benefits or other guarantees.
  • Any restrictions on or penalties for the early termination of or withdrawal from the product or other effects, if any, of such termination or withdrawal.
  • Whether the insurer offers cooling-off rights and if so, procedures for exercising such rights.
  • Any material investment or other risks associated with the product.

Information when replacing a policy

  • Your intermediary must bring to your attention that it is generally not to your advantage to replace an existing policy with a new policy. Make sure that when you take out a new policy to replace an existing policy, your financial adviser has completed a Replacement Policy Advice Record and discussed it with you. You also need to sign this document.

FAIS complaints procedure

If you have a concern about a product that you have purchased or the financial services that you have received, address it immediately. Find out how to resolve your concern.

Last updated 28 July 2010 15:35


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ContactFAIS Complaints

Postal address:

FAIS Complaints Resolution
Momentum
PO Box 7400
Centurion
0046

Telephone:

+27 (0) 12 673 7838

Fax:

+27 (0) 12 675 8502

Financial Advisory and Intermediary Services Act (FAIS)

Your money is valuable to you, and deciding who should advise you on your investments is not a decision you should take lightly. This Act aims to protect you, the client, by prescribing how financial services, i.e. advice and intermediary services, in respect of your policy or investment should be rendered to you. The FAIS Act regulates the financial services industry to the extent that it requires advisers to have licences in order to operate lawfully. Momentum has committed itself to deal only with intermediaries who are licensed by the Financial Services Board under the FAIS Act.

The FAIS Act also requires intermediaries to carefully consider which product is suitable for their client and to provide service in an honest, fair way with due skill and care.

Under the general code of conduct for authorised financial service providers (FSPs) under the FAIS Act, you are entitled to a great deal of information from your intermediary.Your intermediary is obliged, in terms of FAIS, to disclose fully and accurately information that may affect your decision to conclude a contract or not to do so. The information that your intermediary must provide to you includes information about the product supplier, the intermediary and the financial service (the product). We list some of the more important points below.

Information about the product supplier

  • Name, address and contact details.
  • Names and contact details of the compliance and complaints departments.

Information about the intermediary

  • Full business and trade names, address and contact details.
  • Details of the legal and contractual status of the intermediary and the intermediary's contractual relationship with the product supplier and services providers.
  • Details of the financial service that the intermediary is authorised to provide under the relevant FSP licence, as well as any conditions or restrictions that apply to this.
  • Whether the intermediary holds guarantees or professional indemnity or fidelity insurance or not.
  • Any conditions or restrictions that the insurer/s imposed on the types of financial products or services that the intermediary may provide.
  • Any personal interest that the intermediary may have in the financial service, as well as any conflict of interest.

Information about the financial service

  • General explanation of the nature and material terms of the relevant contractor transaction; name and type of the financial product and the nature and extent of the benefits.
  • Material contractual information, illustrations, projections or forecasts.
  • Any charges and fees to be levied against the product, including the amounts, and their frequency to enable the client to determine the net investment amount.
  • Nature and extent of monetary obligations that the client assumed, directly or indirectly, in favour of the insurer and in favour of the intermediary.
  • Nature, extent and frequency of any incentive, remuneration, consideration, commission, fee or brokerage that any insurer has to pay to the intermediary or for which the intermediary may become eligible, as a result of rendering of the financial service.
  • Details of any special terms or conditions, exclusions or liability, waiting period, loadings, penalties, excesses, restrictions or circumstances in which the insurer will not provide benefits.
  • Details of any guaranteed minimum benefits or other guarantees.
  • Any restrictions on or penalties for the early termination of or withdrawal from the product or other effects, if any, of such termination or withdrawal.
  • Whether the insurer offers cooling-off rights and if so, procedures for exercising such rights.
  • Any material investment or other risks associated with the product.

Information when replacing a policy

  • Your intermediary must bring to your attention that it is generally not to your advantage to replace an existing policy with a new policy. Make sure that when you take out a new policy to replace an existing policy, your financial adviser has completed a Replacement Policy Advice Record and discussed it with you. You also need to sign this document.

FAIS complaints procedure

If you have a concern about a product that you have purchased or the financial services that you have received, address it immediately. Find out how to resolve your concern.

Last updated 28 July 2010 15:35


Join the discussion  Twitter Facebook