Members of Parliament in Eswatini have questioned the Financial Services Regulatory Authority (FSRA) Chief Executive Officer, Ncamiso Ntshalintshali, regarding the delayed insurance claim by Tesco Cash and Carry. The business suffered a fire two years ago, resulting in an estimated E30 million in damages. The FSRA was summoned to explain the conduct of insurance companies, particularly concerning claims that had not been settled.
Ntshalintshali informed MPs that the FSRA had examined repudiated claims and found that insurers licensed by FSRA had generally remained within international benchmarks over the past three years. However, the Tesco matter was specifically referred to the regulator for scrutiny. He explained that consumers with complaints against financial service providers have access to an independent ombudsman under the Financial Services Regulatory Authority Act of 2010.
The Tesco claim was referred to the ombudsman after engagements between Tesco and the insurer stalled. Ntshalintshali stated that the FSRA deliberately avoided interfering with the ombudsman’s process to prevent disputes from ending up in court. The complexity of the claim required a comprehensive investigation to ensure that any subsequent challenge would be based on disagreement with the decision, rather than allegations of a flawed process.
Ntshalintshali attributed the delays in the claim to the submission of information in stages. The fire destroyed a significant amount of Tesco’s documentation, requiring some information to be reconstructed through affidavits from the business owner. As of Friday, some information was still outstanding, but an update indicated that the missing information had been submitted the previous night after the parties were given a deadline.
The FSRA CEO assured MPs that the ombudsman’s determination would be issued within 48 hours, which would have been Wednesday. However, he warned that the size and nature of the claim created a possibility that the matter could eventually be taken to court. The policy wording had become a contentious issue in the Tesco case, particularly regarding when the complainant received it and whether the client understood the requirements.
MPs raised concerns about the prospects of a fair resolution, with Deputy Speaker Madala Mhlanga questioning whether duplicate files existed, especially since important documents appeared to have been lost in the fire. MP Sabelo Mthethwa questioned why the business was being expected to produce documents when its premises and records had been destroyed by fire, suggesting that Parliament might need to consider changes to FSRA’s leadership.
The FSRA CEO faced further questions from MPs, including Masiphula Mamba, who asked when the ombudsman’s process would be completed, and Allen Vilane, who inquired about the FSRA’s next steps if the ombudsman failed to meet the Wednesday deadline. The matter has raised concerns about the insurance sector and its regulator in Eswatini.
Key points
- The E30 million Tesco insurance claim has been delayed due to the complexity of the case and the need for a comprehensive investigation.
- The FSRA CEO assured MPs that the ombudsman’s determination would be issued within 48 hours.
- MPs raised concerns about the prospects of a fair resolution and the need for changes to FSRA’s leadership.
