The Competition Commission, a body empowered to investigate, control and evaluate business practices and efficiency in the country, raided some of the biggest insurance companies suspected of price-fixing on Thursday.
Among the companies are Momentum, Old Mutual Insure Limited; Professional Provident Society Limited and South African National Life Assurance Company (Pty) Ltd (Sanlam).
“Raids are taking place in Gauteng, Western Cape and KwaZulu-Natal at the head offices of BrightRock Life Limited; investigators will seize documents and electronic data, which will be analysed together with other information gathered to determine if these firms have contravened the Competition Act,” said the commission on its official Twitter page.
It said it had reasonable reason to believe that BrightRock Life Limited; Discovery Limited; FMI, a division of Bidvest Life Limited; Hollard Insurance Group (Pty) Ltd; Momentum, a division of MMI Limited; Old Mutual Insure Limited; Professional Provident Society Limited and South African National Life Assurance Company (Pty) Ltd (Sanlam) have engaged in collusive practices to fix prices and/or trading conditions in respect of fees for investment products such as retirement annuity and premiums for risk related products, namely, life insurance cover such as dread disease cover / chronic medical condition cover, disability cover, life cover and funeral assistance benefits in contravention of the Competition Act.
“According to the information at the disposal of the Commission, the companies under investigation share information on premium rates for risk-related products and fees for investment products, which enables them to adjust the prices of their existing and new insurance products,” reads the official statement.
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