Competition Commission cracks down on insurance companies that fix prices – SABC News

The Competition Commission says the country’s laws prohibit competitors from sharing sensitive information that could manipulate insurance prices.

This is in response to raiding the offices of eight major insurers it is investigating for possible price collusion.

The commission carried out search and seizure operations on Thursday at the premises of eight insurance companies, including Old Mutual, Brightrock, Discovery, Hollard and Sanlam.

The companies would have colluded to price the fees for investment products such as retirement annuities, life insurance, disability and funeral assistance benefits.

Commission spokesperson Sipho Ngwema said the search and seizure operations are part of an ongoing investigation which was opened in January 2021.

The raids were carried out in Gauteng, KwaZulu-Natal and the Western Cape and will continue on Friday morning.

Ngwema says the insurance companies that have been raided say they will cooperate fully with the authorities.

“There were suspicions of price fixing or collusion. There were companies coming together to set prices. The accusation is that these companies shared sensitive information regarding premiums, rates for risk related products like life covers, funeral covers and dread disease covers etc.

“The allegations are that these companies sit down in violation of competition law and then decide among themselves how to adjust prices so that the prices agreed between them are then offered to consumers who then buy these products,” adds Ngwema.

Below is the full interview with Sipho Ngwema:

Comply with surveys

In a statement, Old Mutual confirmed the raid at its offices in Mutual Park in Cape Town.

Old Mutual declares that it is committed to acting responsibly.

However, he cannot comment further at this stage.

Discovery says it only learned of the investigation during the raid.

He says he will comply with the commission’s request for information about its investigation.

Kristan F. Talley