Section 40: Appointment of auditor and actuary

40. Appointment of auditor and actuary (1) Subject to this section and any FSC Rules, an insurer shall appoint and have at all times— (a) an auditor; and (b) an actuary. (2) Subject to subsection (5), an appointment made under subsection (1) shall not be effective except where it is approved by the Commission. (3) In making an appointment under subsection (1), an insurer shall consider and state in the resolution making the appointment whether the auditor or the actuary, as the case may be— (a) holds the required qualifications and competence and has proven experience and adequate resources to perform his functions; (b) is independent of the insurer in that he, or in the case of a firm, any of his partners, has no relationship with or interest in, the insurer, any of its group of companies, nor has any connection with any director or substantial shareholder of the insurer, which could reasonably be perceived to materially affect the exercise by him of an independent mind and judgement in the performance of his duties; (c) is fit and proper in accordance with such guidelines as may be made by the Commission. I15 – 31 [Issue 1] Insurance Act (4) An application for approval under subsection (2) shall be made in writing and shall be accompanied by a certified copy of the resolution made under subsection (3) or any information and document as the Commission may reasonably require. (5) Except where it is expressly objected to by the Commission within 15 days of its submission of the application made under subsection (4), the appointment shall be deemed to have been approved and shall become effective. (6) In determining its application under subsection (4), the Commission may take into consideration— (a) any report from the professional organisation of which the proposed appointee is a member, or from a supervisory body; (b) any matter or information relevant to determine whether the proposed appointee is a fit and proper person. (7) Where an insurer does not have an auditor or an actuary approved pursuant to this section, the Commission shall make the appointment at the cost of the insurer. (8) Where an auditor or actuary appointed by an insurer is a firm— (a) the firm shall designate a partner as the signing partner who shall, for the purposes of this Act, without any limitation to the obligations and liabilities of the other partners or associates, have all the duties, responsibilities and obligations of an auditor or actuary as if he were himself appointed; (b) the last approval of the Commission for the appointment of the firm shall not lapse by reason of a change in the membership of the firm provided that at least half of the members, after the change, were members when the appointment of the firm was last approved by the Commission. [S. 40 amended by s. 14 of Act 16 of 2007 w.e.f. 28 September 2007.]