Insurance Industry Act

CHAPTER 46:01
INSURANCE INDUSTRY
ARRANGEMENT OF SECTIONS
SECTION
PART I
Preliminary
1. Short title
2. Interpretation
PART II
3. - 4. ......
PART III
Capital and other Requirements for Insurers other than
Associations of Underwriters
5. Application of Part III
6. Insurer to be a resident company
7. Restrictions on general and long term insurers
8. Separation of insurers and brokers
9. Capital requirement
10. Margin of solvency
11. Statutory Reserve Solvency Account
PART IV
Provisions governing Insurers other than Associations of Underwriters
12. Application of Part IV
13. Licensing of an insurer
14. Exclusion of burial societies
15. ......
16. Licensing requirements
16A. Renewal of licence of an insurer
17. Restriction on insurers whose officers are deemed unsuitable
18. Grant of application
19. - 22. ......
23. Retentions and reinsurances
24. ......
25. Preservation of records
26. Amendment of accounts, etc.
27. Audit of accounts of insurers
28. Registrar's powers re commissions, deposit of funds and management expenses
29. Valuation of assets and liabilities
30. Change of financial year
31. Annual returns to the Registrar
32. Publication of authorised capital
33. Powers re restriction and instruction on insurers
34. Trusteeship of assets
35. Preferred creditors of an insurer
36. Insurers' code of practice
37. Classification
PART V
Association of Underwriters Licensed as Insurers
38. Application of Part V
39. Registrar to determine conditions for licensing
40. Association of underwriters to deposit sums or securities
41. Premiums received to be held in trust
Copyright Government of Botswana

42. Audit of accounts of an association of underwriters
PART VI
Third Party (Rights against Insurers)
43. Third party rights against insurers on bankruptcy, etc. of the insured
44. Duty to give necessary information to third parties
45. Settlement between insurers and insured persons
PART VII
Licensing Requirements of Insurance Brokers, Insurance Agents
and Agents for Brokers
46. Insurance brokers, agents and agents for brokers to be licensed
47. Agents to act for one principal only
48. Insurer's and broker's responsibility for agents
49. Licensing of agents
49A. Renewal of licence of an agent
50. ......
51. Restriction on broker's officers
52. Licensing requirements of insurance brokers
52A. Renewal of licence of an insurance broker
53. Grant of broker's application
54. Broker's capital requirements
55. Broker's responsibilities and insurance requirements
56. Broker's records and rights of access
57. Broker's responsibility for premiums
58. Broker's accounts
59. Cancellation of licence
60. ......
61. Financial year end of broker
62. Broker's amalgamations, sales and transfers
63. Broker's annual returns to the Registrar
64. Insurance brokers' code of conduct
PART VIII
Special Provisions relating to Long Term (Life) and
other Policies
65. Life insurance tables
66. Insurable interest essential for all policies
67. - 68. ......
69. Periodic actuarial investigations
70. Establishment of statutory life insurance fund
71. Application of assets of insurer with long term business
72. Restriction on transaction with connected persons
73. Exemption: Botswana Development Corporation
74. Reinsurance contracts of long term insurers
75. Allocations to policyholders
76. Investment unit policies
77. Life insurance of minors
78. Value of certain assets
79. Life policy effected by married persons
80. Life policy on own life: protection afforded during life
81. Life policy on own life: protection afforded on death
82. Protection afforded in respect of life policy inuring to spouse or children
83. Protection afforded in respect of life policy inuring to wife
84. Special provisions relating to persons married in community of property

85. Selection for realisation of life policies in respect of which protection is afforded
86. Partial realisation and partial conversion of life policies
87. Provisions in case premium on life policy ceded or trust policy cannot be maintained
88. Life policy ceded or premium paid with intent to benefit someone at the expense of a
creditor
89. Power to pay into court
90. No deductions in respect of other life policies
91. Proof of age
92. Age incorrectly stated
93. Suicide
94. Lost or destroyed life policy
95. Life policy may include subsidiary benefits
96. Discrimination between life policies, etc. prohibited
97. Non-forfeiture of life policies in certain cases of non-payment of premiums
98. Paid-up policies
99. Surrender of policies
100. Cancellation of life policy within limited period without penalty
101. Publication of bonus rates and unit values
102. Advertisements and projected benefits
PART IX
Miscellaneous Provisions
103. Fatal accidents
104. Insurances to be held with Botswana insurers
105. Compulsory local brokerage
106. Unlimited indemnities prohibited
107. Commissions only to brokers and agents
108. Time limit on payment of premiums
109. Days of grace
110. Exemption
111. Extension of time
112. ......
113. Inspection of balance sheet by policyholder, etc.
114. Restriction on use of words "insurance" and "assurance"
115. No advertisement before licensing
116. Service of process
117. Enforcement of rights of policyholders
118. - 121. ......
122. Inspection of returns to the Registrar
123. ......
124. Continuation of business of insurer in liquidation
125. Secondary companies
126. False documents
127. Fees
128. Contraventions punisable by regulatory authority
129. Offences punishable by court
130. General penalty
131. Regulations
132. Application of Act
First Schedule - Classes of Long Term Business

Second Schedule - Classes of General Business
Act 21, 1987,

S.I. 120, 1990,

Act 17, 2003,
Act 2, 2007,
S.I. 11, 2008.
An Act to make provision relating to the carrying on of insurance business and other
matters connected therewith.
[Date of Commencement:
ss 47, 52, 57(2), (3) and (4), and 105: 1st July, 1991;
s 54: 1st July, 1992;
the rest of the Act, except ss 104 and 106: 1st July, 1990;
ss 104 and 106: 22nd January, 2008]
PART I
Preliminary (ss 1-2)
1. Short title
This Act may be cited as the Insurance Industry Act.
2. Interpretation
In this Act, unless the context otherwise requires-
"actuary" means-
(a) a fellow of the Institute of Actuaries in England or of the Faculty of Actuaries in
Scotland; or
(b) such other person having actuarial knowledge as the Registrar may approve;
"agent" means the same as "insurance agent" herein described;
"agent for broker" means a person who transacts insurance business on behalf of a
registered insurance broker;
"approved securities" means securities issued by the Government and such other
securities or investments as the Registrar may approve;
"associate", in relation to an applicant for licensing as an insurer or broker includes-
(a) the spouse or minor son or daughter of that person;
(b) any company of which that person is a director;
(c) any person who is an employee or partner of that person; or
(d) if that person is a company-
(i) any director of that company;
(ii) any subsidiary of that company;
(iii) any director or employee of any such subsidiary;
"association of underwriters" means underwriters at Lloyd's of London;
"broker" means the same as "insurance broker" herein described;
"chairman", in relation to an association of persons, includes the individual presiding
over the board of directors or other governing body of the association;
"child" includes an illegitimate child, stepchild or a child adopted in accordance with the
Adoption of Children Act, or in accordance with any enactment whatsoever, whether within or
outside Botswana, relating to the adoption of children;
"contingent obligation dependent on a human life" means-
(a) an obligation to pay to a particular person certain sums of money or to provide for a
particular person certain other benefits-
(i) on the occurrence of death of a particular person or the birth of a child to a
particular person at any time or within a specified period; or
(ii) in the event of a particular person continuing to live throughout a specified period;
or
(b) an obligation assumed-
(i) until the death of a particular person; or

(ii) during a specified period or until the occurrence of the death of a particular person
before the expiration of that period;
"controller", in relation to an applicant for licensing as an insurer or broker, means-
(a) a Managing Director or Chief Executive of the applicant or of a body corporate of which
the applicant is a subsidiary; or
(b) a person in accordance with whose directions or instructions the directors of the
applicant or of a body corporate of which the applicant is a subsidiary are accustomed
to act; or
(c) a person who either alone or with an associate or associates is entitled to exercise, or
control the exercise of, one-third or more of the votes at any general meeting of the
applicant or of any body corporate of which the applicant is a subsidiary;
"controller", of a person or body corporate, other than in relation to an applicant for
licensing as an insurer or broker means-
(a) a Managing Director or Chief Executive of a body corporate which is a subsidiary of the
person or body corporate;
(b) a person in accordance with whose directions or instructions the directors of a body
corporate which is a subsidiary of the person or body corporate are accustomed to act;
or
(c) a person who either alone or with an associate or associates is entitled to exercise, or
control the exercise of, 15 per cent or more of the votes at any general meeting of, or
of a subsidiary of, a person or body corporate;
"dependant", in relation to any person, includes his surviving spouse and any parent,
child and grandchild of his;
"deposit" means a deposit of money or anything having a monetary value which by
virtue of the regulations made under this Act may be accepted as a deposit;
"deposit administration policies" means a contract whereby-
(a) an insurer maintains a fund to which-
(i) is credited all amounts paid by the insured to the fund; and
(ii) is debited all amounts withdrawn from the fund to provide benefits in terms of the
rules of the fund and such administrative and other expenses as are agreed upon
between the insured and the insurer from time to time; and
(iii) such investment income and capital profits or losses as are agreed upon between
the insured and the insurer as being for the account of the fund; and
(b) the liability of the insurer to the insured, at any given time, is limited to the amount
standing to the credit of the fund;
"director" includes an individual occupying the position of director or alternate director
of an association of persons or a member or alternate member of a committee of management
or of any other governing body of an association of persons, by whatever name he may be
called;
"financial year", in relation to an insurer, means each period of 12 months at the end of
which the balance of the accounts is struck, and includes any lesser or greater periods as the
Registrar shall approve;
"friendly society" means an association of persons established with no share capital
for the purpose of aiding its members or their dependants, where such association does not
employ any person whose main occupation is the canvassing of other persons to become
members of the association or the collecting of contributions or subscriptions from its members
towards the funds of the association;
"funeral policy" means a policy whereby the insurer assumes, in return for a premium
or the promise of a premium, an obligation to provide, on the death of any person, benefits, not
exceeding in value such amount as may be prescribed, which consist principally of provision for
the funeral of that person or the grant to another person of some non-monetary benefit, whether

or not the policy provides for-
(a) the payment at the option of the insurer or any other person of a sum of money instead
of provision of a funeral or the grant of a non-monetary benefit; or
(b) the payment of a sum of money in addition to the provision of a funeral or the grant of
some non-monetary benefit;
"general business" has the meaning assigned to it under section 37;
"gross profit" means the chargeable income of the insurer as ascertained under Part VI
of the Income Tax Act;
"insolvency" has the meaning assigned to it by the Insolvency Act;
"insurance agent" means a person who solicits applications for insurance, collects
moneys by way of premiums and acting in accordance with his agency agreement may bind the
licensed insurer for whom he acts in the issue of insurance cover;
"insurance broker" means persons, who acting with complete freedom as to their
choice of undertaking, and for commission or other compensation and not being an agent of the
insurer, bring together, with a view to the insurance or reinsurance of risks, persons seeking
insurance or reinsurance and insurance or reinsurance undertakings, carry out work preparatory
to the conclusion of contracts of insurance or reinsurance, and, where appropriate, assist in the
administration and performance of such contracts, in particular in the event of a claim;
"insurance business" includes assurance and reinsurance;
"insurer" means a person carrying on an insurance business, otherwise than as a
broker or agent, and includes an association of underwriters;
"life insurance business" means the business of assuming the obligations of an
insurer classified under section 37 as transacting long term business;
"life insurance fund" means the fund established under section 70 to which the
receipts of an insurer in respect of his life insurance business are carried;
"life policy" means any contract of insurance made or agreed to be made by an insurer
classified under section 37 as transacting long term business;
"long term business" has the meaning assigned to it under section 37;
"management expenses" means expenses incurred in the administration of an insurer
which are not commission payable and, in the case of general insurance business, are not
incurred in claims paid, claims outstanding, expenses for settling claims and expenses for
settling claims outstanding;
"manager", in relation to an applicant for licensing as an insurer or broker includes an
employee of the applicant (other than a controller), who, under the immediate authority of a
director or chief executive of the applicant exercises managerial functions or is responsible for
maintaining accounts or other records of the applicant not exclusively related to business
conducted from a place of business outside Botswana;
"member of the insurance industry" includes an insurer, reinsurer, broker, agent,
insurance surveyor, risk manager, loss assessor, loss adjuster and claims settlement agent,
whether licensed under this Act or not;
"minor" means a person who, by reason of his youth, is under a legal disability;
"owner", in relation to a policy, means the person who for the time being has the legal
title to the policy;
"policy" includes every writing whereby any contract of insurance is made or agreed to
be made;
"prescribed" means prescribed by regulations made under section 131;
"principal officer" means the person for the time being serving one principal officer and
being responsible for the daily management of the principal officer in Botswana of the insurer,
broker or agent;
"Registrar" means the Regulatory Authority established under the Non-Bank Financial
Institutions Regulatory Authority Act;

"stock insurance company" means an insurance company with permanent share
capital owned and controlled by its shareholders and includes a statutory corporation carrying
on insurance business;
"trustee", in relation to an estate in insolvency, includes an assignee or, as the case
may be, a trustee in a deed of arrangement of the person having the conduct of an order of
composition;
"underwriter" includes any person named in a policy or other contract of insurance as
liable to pay or contribute towards the payment of the sum secured by the policy or contract;
"underwriter's liabilities", in relation to a member of an association of underwriters,
means the liabilities of the insurance business of the member calculated in accordance with
formulae fixed by the responsible body at Lloyds of London vested with the administration of the
relevant insurance law.
PART II
Administration (ss 3-4)
3. - 4. ...... PART III
Capital and other Requirements for Insurers other than Associations of Underwriters (ss
5-11)
5. Application of Part III
This Part shall apply only to insurers who are not associations of underwriters.
6. Insurer to be a resident company
No insurer may, after the coming into operation of this Act, be licensed as an insurer in
Botswana unless it is incorporated as a company under the Companies Act and is deemed to
be resident in Botswana.
7. Restrictions on general and long term insurers
(1) No individual insurer may transact both general and long term insurance business.
(2) Any insurer who carries on business in contravention of this provision will be liable to
have his licence cancelled.
(3) An insurer transacting both general and long term insurance business immediately
before the coming into operation of this Act shall be permitted to transact both general and long
term insurance business for a period not exceeding one year from the date on which this Act
comes into operation.
8. Separation of insurers and brokers
(1) No insurer shall register the transfer of more than five per cent of its shares to any
person or body of persons directly or indirectly, wholly or partly owned or controlled by a
Botswana licensed insurance broker or to any person or body of persons directly or indirectly by
itself or through any nominee holding, at that time, any legal or equitable interest in any
Botswana licensed broker or any person or body of persons associated with either.
(2) No insurer shall directly or indirectly acquire or hold any legal interest or any
equitable interest in excess of five per cent in any Botswana licensed insurance broker or in any
company or partnership directly or indirectly by itself or through any nominee holding, at that
time, any legal or equitable interest in any Botswana licensed broker or in any company or
partnership associated with any such broker.
(3) No Botswana licensed broker may permit any Botswana licensed insurer or person or
body of persons directly or indirectly by itself or through any nominee holding, at that time, any
legal or equitable interest in any Botswana licensed insurer, or any person or body of persons
associated with either, to acquire or hold more than a five per cent interest in its business as a
broker.
(4) No person, company or body of persons who has a legal or equitable interest in or is
owned, controlled or employed by-
(a) any Botswana licensed insurance broker; or
(b) any Botswana licensed insurer,

may be employed as the manager, controller, director or principal officer of a Botswana licensed
insurer or broker respectively, nor may a Botswana licensed insurer or broker enter into any
management agreement with any such person, company or body of persons.
(5) Where at the coming into force of this Act an insurer or broker is in contravention of
any of the provisions of subsections (1) to (4), such insurer or broker may, notwithstanding such
contravention, be licensed under this Act for a period not exceeding two years.
9. Capital requirement
(1) The Minister shall prescribe the minimum paid-up share capital to be maintained by a
licensed insurer.
(2) For the purposes of subsection (1) the Minister may prescribe different amounts in
respect of insurers transacting general business and insurers transacting long term business.
(3) Every insurer shall transfer from its net profits of each year, before any dividend is
declared and after due provision has been made for taxation, a sum not less than 25 per cent in
the case of an insurer transacting long term business or 15 per cent in the case of an insurer
transacting general business-
(a) to the paid-up share capital of the insurer; or
(b) to a Capital Reserve Account which account may be reduced only for the purpose of
increasing the paid-up share capital of the insurer:
Provided that an insurer shall not be required to transfer any part of its net profits if the
aggregate of the paid-up capital and the Capital Reserve Account exceeds such sum as may be
prescribed by the Minister:
Provided also that the Capital Reserve Account shall be wholly utilised not less
frequently than every five years to increase the paid-up share capital of the insurer.
(4) Any licensed insurer who permits its paid-up share capital to be reduced to a level
below that prescribed by the Minister or fails to increase capital in accordance with the
requirements of subsection (3) shall be guilty of an offence and shall in addition to any other
penalty prescribed by this Act be liable to have its licence cancelled.
(5) The Minister may by regulations prescribe the form in which paid-up share capital
may be maintained by an insurer.
10. Margin of solvency
(1) No insurer may carry on business as an insurer unless it maintains in Botswana at all
times while it so carries on insurance business a margin of solvency of not less than such
amount as may be prescribed.
(2) Regulations may prescribe the method of calculating the assets and liabilities of an
insurer for the purposes of this section.
(3) Any insurer acting in contravention of this section shall be guilty of an offence and
shall in addition to any penalty prescribed by this Act be liable to have its licence cancelled.
11. Statutory Reserve Solvency Account
(1) Upon the coming into force of this Act every licensed Botswana insurer transacting
general business shall commence and maintain a statutory fund (to be known as the "Statutory
Reserve Solvency Account"), and shall, in every year, before any dividend is declared, transfer
to such account a sum equivalent to 10 per cent of its gross profits:
Provided that, where the transfer of 10 per cent of its gross profits would result in the
total sum in the account exceeding 25 per cent of the gross premiums received in the previous
financial year, an insurer may transfer only so much as is necessary to raise the total sum in its
account to a sum equivalent to 25 per cent of the gross premiums received in the previous
financial year.
(2) The Statutory Reserve Solvency Account shall be kept distinct and separate from all
other accounts in the books of account and other records of the insurer.
(3) The Statutory Reserve Solvency Account shall neither be reduced nor encumbered:
Provided that the Registrar may by notice in writing to the insurer specify circumstances

in which it may be reduced or encumbered.
(4) No insurer shall at any time declare credit or pay any dividend or make any other
transfer from profits other than a transfer to the Statutory Reserve Solvency Account until all
encumbrances or reductions allowed by the Registrar under the provisions of subsection (3)
have been removed.
PART IV
Provisions governing Insurers
other than Associations of Underwriters (ss 12-37)
12. Application of Part IV
This Part shall apply only to insurers who are not associations of underwriters.
13. Licensing of an insurer
(1) Subject to the provisions of this Part, no person resident in Botswana shall
commence or carry on insurance business unless he is licensed as an insurer under this Act.
(2) An insurer resident in Botswana carrying on insurance business immediately before
the commencement of this Act may, within three months after such commencement, make an
application for a licence under this Act, and may, until the grant or refusal of its application,
continue to carry on its insurance business.
14. Exclusion of burial societies
(1) The provisions of this Act shall not apply to burial societies, registered under the
Societies Act.
(2) Notwithstanding the provisions of subsection (1), section 119 of the Act shall apply to
burial societies.
15. ...... 16. Licensing requirements
An insurer seeking a licence shall satisfy the Registrar that-
(a) it is a company registered under the Companies Act;
(b) it has a principal office in Botswana;
(c) its controller, manager, principal officer and directors who handle the day to day
management of the company are all resident in Botswana; and that
(d) its controller, manager and principal officer are persons with sufficient business and
insurance knowledge and experience.
16A. Renewal of licence of an insurer (1) Every insurer shall, immediately after a period of
12 months has expired from his initial licensing, apply to the Registrar in such form as may be
prescribed to renew such licence for a further period of 12 months.
(2) An insurer shall thereafter apply to the Registrar to renew his licence whenever a
period of 12 months has expired from his previous renewal of licence.
(3) Where an insurer does not renew his licence when it expires, he shall pay, to the
Registrar, a penalty of P150 per day during the period he does not renew his licence, which
period shall not exceed three months.
(4) Where an insurer does not renew his licence within three months of its expiry, the
Registrar shall cancel that licence.
(5) Where the licence of an insurer is cancelled, the insurer shall re-apply for a licence,
which re-application shall be treated as a new application for a licence.
17. Restriction on insurers whose officers are deemed unsuitable
No insurer may employ as its manager, controller or principal officer any person who-
(a) has been adjudged an undischarged bankrupt in any country;
(b) has made an assignment to or arrangement or composition with creditors which has
not been rescinded or set aside;
(c) has been convicted by any court in any country of an offence involving dishonesty; or
(d) is in the opinion of the Registrar an unfit person to hold the office.
18. Grant of application
(1) If the Registrar is satisfied that-

(a) the class or classes of insurance business in respect of which the application is made
will be conducted in accordance with sound insurance principles;
(b) the relevant capital requirements for insurers are adequate, having regard to any
regulations made in relation thereto under section 9, have been complied with by the
applicant;
(c) the margin of solvency of the insurer is adequate having regard to any regulations
made in relation thereto under section 10; and
(d) the applicant complies with the requirements of Parts III and IV of this Act,
the Registrar may grant the application for a licence as an insurer and issue the prescribed
licensing certificate.
(2) A notice of the grant under this section of every application shall be published in the
Gazette.
19. - 22. ...... 23. Retentions and reinsurances
(1) The Registrar may by stipulating in writing to the insurer set limits within which a
licensed insurer may accept insurances of all or any class by-
(a) restricting the gross premiums received by an insurer to a specified maximum in any
one financial year; or
(b) restricting the gross premiums less gross reinsurances payable by an insurer to a
specified maximum.
(2) The Registrar may by stipulating in writing to an insurer prohibit a licensed insurer
from transacting any individual policy or all insurance of a class or classes where-
(a) in the opinion of the Registrar the arrangements for reinsurance in respect of which
persons, property or interests are, or are to be, insured by the insurer in the course of
carrying on insurance business are not favourable to the economy or the insurance
industry or are not in the public interest; or
(b) in the opinion of the Registrar the gross or net retention limits are too low or too high.
(3) The Registrar, having regard to such matters as he considers relevant, may, by
notice in writing to the insurer, exempt an insurer, subject to such terms and conditions and for
such period as he specifies in the notice, from the requirements of this section.
24. ...... 25. Preservation of records
An insurer shall maintain all records or accurate transcriptions of all records relating to
insurance transactions inside and outside Botswana undertaken by it, for a minimum period of
six years-
(a) in the case of a life policy, after the maturity, cancellation, surrender or realisation of
the policy or after the death of the insured;
(b) in all other cases after the maturity, cancellation or realisation of the policy or date of
loss.
26. Amendment of accounts, etc.
(1) If, in the opinion of the Registrar, an account or balance sheet furnished by a
licensed insurer under section 31 is incorrect or is not prepared as prescribed, the Registrar
may, by notice in writing, call upon the insurer to amend such account or balance sheet, to
furnish a correct account or balance sheet, or, as the case may be, an account or balance sheet
prepared as prescribed under section 31.
(2) If a licensed insurer fails to comply with a notice referred to in subsection (1) to the
satisfaction of the Registrar, the Registrar may himself either amend the account or balance
sheet giving the insurer particulars of the amendments, or he may reject the account or balance
sheet.
(3) An account or balance sheet amended by an insurer or the Registrar under this
section shall be treated as if it had been originally submitted in its amended form.
27. Audit of accounts of insurers
(1) The accounts of every licensed insurer shall be audited annually by a resident auditor

approved by the Registrar.
(2) The form of an audit referred to in subsection (1) shall be in accordance with the
requirements of the Companies Act and shall contain such other information or such additional
declarations as the Minister may by regulations prescribe.
28. Registrar's powers re commissions, deposit of funds and management expenses
(1) The Registrar may, by notice in the Gazette, determine the minimum and maximum
commission rates payable by insurers to other insurers, brokers or agents in respect of all or
any class of insurance whether insurance or reinsurance.
(2) The Registrar may, by notice in writing, require an insurer to deposit in the Bank of
Botswana, within such time as the Registrar shall consider reasonable, such securities as the
Registrar shall stipulate in the said requisition in respect of any or each class of insurance
business being carried on by that insurer.
(3) After consideration of the extent and duration of the business carried on by an insurer
and the provision generally made for management expenses in the premium rates of insurers,
the Registrar may-
(a) by notice published in the Gazette require insurers to limit their management expenses
to an amount contained in the notice;
(b) by notice in writing to an insurer allow dispensation from the provisions of paragraph
(a) to any other amount and for any period as the Registrar shall consider reasonable
except that such period shall not exceed two consecutive years.
29. Valuation of assets and liabilities
(1) The Minister may make regulations with respect to the determination of the value of
assets and the amount of liabilities in any case in which the value or amount is required by any
provision of this Act to be determined in accordance with valuation regulations.
(2) Without prejudice to the provisions of subsection (1), regulations made under this
section may provide that, for any specified purpose, assets or liabilities of any specified class or
description shall be left out of account or shall be taken into account only to a specified extent.
(3) For the purposes of this section the Minister may make separate regulations for the
determination of the value of assets and the amount of liabilities of general and long term
insurers.
30. Change of financial year
The financial year of an insurer may be changed by the insurer with the approval of the
Registrar.
31. Annual returns to the Registrar
(1) An insurer shall, within four months after the end of its financial year furnish to the
Registrar in the prescribed forms-
(a) an audited balance sheet and profit and loss account;
(b) an audited income and expenditure statement for each category of insurance
underwritten;
(c) an audited statement of solvency;
(d) an audited statement of all admissible and inadmissible assets; and
(e) all such other information as he may require.
(2) The Registrar may, at his discretion, extend the time within which the insurer should
comply with the provisions of subsection (1) by a maximum of three months:
Provided that an insurer shall be liable to pay to the Registrar a penalty of P150 for
every day during which it is in default beyond such extended time granted by the Registrar.
(3) Where the insurer fails to furnish the required documents and information within the
extended time or fails to pay the penalty, the insurer shall be regarded as having failed to
comply with the provisions of subsection (1).
32. Publication of authorised capital
An insurer shall not publish or issue a document on which is printed a statement-

(a) of its authorised share capital, unless the statement also sets forth the amount of its
subscribed capital and of its paid-up capital; or
(b) of its subscribed capital, unless the statement also sets forth the amount of its paid-up
capital.
33. Powers re restriction and instruction on insurers
(1) The Minister may by regulations-
(a) prohibit an insurer from making investments of a specified class or description;
(b) require an insurer to realise the whole or part of a particular investment within a
specified period;
(c) require an insurer or all insurers to invest such percentage of the insurance funds of
such insurers or insurer, as the case may be, accruing in respect of their or its
insurance business in Botswana or assets representing the Statutory Reserve
Solvency Account in such Botswana securities and such other securities in Botswana,
as may be specified.
(2) An instrument made under subsection (1) may prescribe different percentages of
such insurance funds to be so invested according to the class or description of an insurer, and
may prescribe different percentages for local insurers.
(3) Except with the prior express consent in writing of the Registrar, no insurer shall
invest or otherwise lend insurance fund moneys outside Botswana.
(4) An insurer may-
(a) borrow any money, whether secured or unsecured;
(b) guarantee or bind itself as surety for the discharge of any debt or obligation of any
person or body of persons, or issue any bond, guarantee or undertaking provided it is
licensed to carry on such guarantee business and the guarantee or undertaking is
incorporated in a guarantee policy,
except that where it mortgages or charges assets-
(i) exceeding 20 per cent of the aggregate of its paid up share capital and Capital
Reserve Account in the case of an insurer other than an insurer carrying on long term
insurance business in order to secure for itself temporary loans or bank overdrafts; or
(ii) exceeding 25 per cent of the aggregate life insurance funds or four times the aggregate
of its paid up share capital and Capital Reserve Account, whichever is less in the case
of an insurer carrying on long term insurance business in order to secure loans for
itself,
it shall notify the Registrar in writing within one month of so doing and shall provide the
Registrar with such information as the Registrar may require relating thereto.
(5) The Minister may, by statutory instrument, make an order enjoining the Registrar
himself to take or require an insurer to take such action as appears to the Registrar appropriate
to protect the policyholders of the insurer against the risk that the insurer may be unable to meet
its liabilities, or in the case of an insurer transacting long term business, to fulfil the reasonable
expectations of the policyholders.
34. Trusteeship of assets
(1) The Registrar may, at any time before or during the course of an investigation in
terms of section 112, require an insurer to transfer all or a specified portion of its assets into a
trust to be administered by a person nominated by the Registrar.
(2) Except with the prior consent of the Registrar the assets subject to trusteeship in
subsection (1) shall not be mortgaged, pledged or otherwise encumbered in any manner
whatsoever in favour of any other person.
35. Preferred creditors of an insurer
Notwithstanding any law to the contrary, in the event of the liquidation, insolvency or
bankruptcy of a licensed insurer-
(a) the owners of life policies and other classes of long term business issued by the insurer

shall have preference against all other creditors of the insurer in respect of the life
insurance and long term business funds maintained by it; and
(b) the owners of all other policies issued by the insurer shall rank before any other
creditor of the insurer in the distribution of such assets of the insurer as remain after
the claims, if any, by owners of life policies and other classes of long term business
against the estate have been discharged.
36. Insurers' code of practice
(1) The Minister may by regulations set out a code of practice and a guide for insurers in
the conduct of their business:
Provided that an insurer may in the interest of prudent underwriting, and in specific
cases, undertake practices discouraged by the code, but shall submit his reasons for so doing,
in writing, to the Registrar as soon as practicable thereafter.
(2) The principal officer of each insurer shall ensure that all directors, managers and
employees of the insurer are made aware of, and comply with, the provisions of the code of
practice described in subsection (1).
37. Classification
(1) For the purposes of this Act insurance business is divided into long term business
and general business; and-
(a) "long term business" means insurance business of any of the classes specified in the
First Schedule to this Act; and
(b) "general business" means insurance business of any of the classes specified in the
Second Schedule to this Act.
(2) For the purposes of this Act the effecting and carrying out of a contract whose
principal object is within one class of insurance business, but which contains related and
subsidiary provisions within another class or classes, shall be taken to constitute the carrying on
of insurance business of the first mentioned class, and no other, if subsection (3) or (4) applies
to the contract.
(3) This subsection applies to a contract whose principal object is within any class of
long term business but which contains subsidiary provisions within general business class 1 or 2
if the insurer is authorised to carry on long term business class 1.
(4) This subsection applies to a contract whose principal object is within one of the
classes of general business but which contains subsidiary provisions within another of those
classes, not being general class 14 or 15.
PART V
Association of Underwriters Licensed as Insurers (ss 38-42)
38. Application of Part V
The provisions of this Part shall apply only to associations of underwriters licensed as
insurers and their members.
39. Registrar to determine conditions for licensing
(1) The Registrar may determine the conditions of licensing of an association of
underwriters.
(2) Notwithstanding the generality of subsection (1), such powers shall include, inter alia,
the determination of the necessity and amount of-
(a) classes of business underwritten;
(b) capital requirements;
(c) margins of solvency;
(d) retention of premiums;
(e) deposits and investments in Botswana; and
(f) any such additional requirements and conditions as considered necessary by the
Registrar.
40. Association of underwriters to deposit sums or securities

The Registrar may request any association of underwriters to deposit a substantial sum
or such securities as are satisfactory to the Registrar in trust with the Bank of Botswana and to
keep that sum so deposited for so long as the association carries on business in Botswana.
41. Premiums received to be held in trust
A proportion, to be determined by the Registrar, of all premiums received by an
association of underwriters from Botswana insurance business shall be held in trust in
Botswana by a trustee approved by the Registrar for the payment of the underwriting expenses
of the association's insurance business in Botswana.
42. Audit of accounts of an association of underwriters
(1) An association of underwriters shall furnish evidence to the satisfaction of the
Registrar that the accounts of each member of the association are subject to an annual audit by
an independent auditor.
(2) The auditor of an association of underwriters shall certify to the committee of the
association whether or not the underwriting assets held by the member at the close of each
financial year are sufficient to cover the underwriting liabilities attached at that time to the
underwriter's accounts.
(3) An association of underwriters shall furnish annually to the Registrar-
(a) a certified copy of the returns of insurance business carried on by the association and
furnished in each year to the appropriate authority in the country where the association
is constituted;
(b) a certificate signed by the chairman of the association and the said appropriate
authority that the members have in respect of the preceding year complied with the
requirements of insurance law in the country where the association is constituted in so
far as it relates to associations of underwriters; and
(c) such other information as the Registrar shall require.
PART VI
Third Party (Rights Against Insurers) (ss 43-45)
43. Third party rights against insurers on bankruptcy, etc. of the insured
(1) Where under any contract of insurance a person (in this Act referred to as "the
insured"), is insured against liabilities to third parties which he may incur, then-
(a) in the event of the insured becoming bankrupt or making a composition or arrangement
with his creditors; or
(b) in the case of the insured being a company, in the event of a winding-up order being
made, or a resolution for a voluntary-winding up being passed, with respect to the
company, or of a receiver or manager of the company's business or undertaking being
duly appointed, or of possession being taken, by or on behalf of the holders of any
debentures secured by a floating charge, of any property comprised in or subject to the
charge,
if, either before or after that event, any such liability as aforesaid is incurred by the insured, his
rights against the insurer under the contract in respect of the liability shall, notwithstanding
anything in any Act or rule of law to the contrary, be transferred to and vest in the third party to
whom the liability was so incurred.
(2) Where an order is made under the Insolvency Act for the administration of the estate
of a deceased debtor according to the law of bankruptcy, then, if any debt provable in
bankruptcy is owing by the deceased in respect of a liability against which he was insured under
a contract of insurance as being a liability to a third party, the deceased debtor's rights against
the insurer under the contract in respect of that liability shall, notwithstanding anything in the
said Act, be transferred to and vest in the person to whom the debt is owing.
(3) In so far as any contract of insurance made after the commencement of this Act in
respect of any liability of the insured to third parties purports, whether directly or indirectly, to
avoid the contract or to alter the rights of the parties hereunder upon the happening to the

insured of any of the events specified in paragraph (a) or (b) of subsection (1) or upon the
making of an order under the Insolvency Act in respect of his estate, the contract shall be of no
effect.
(4) Upon a transfer under subsection (1) or (2), the insurer shall, subject to the
provisions of section 45, be under the same liability to the third party as he would have been to
the insured, but-
(a) if the liability of the insurer to the insured exceeds the liability of the insured to the third
party, nothing in this Part shall affect the rights of the insured against the insurer in
respect of the excess; and
(b) if the liability of the insurer to the insured is less than the liability of the insured to the
third party, nothing in this Part shall affect the rights of the third party against the
insured in respect of the balance.
(5) For the purposes of this Part, the expression "liabilities to third parties" in relation to
any person insured under any contract of insurance, shall not include any liability of that person
in the capacity of insurer under some other contract of insurance.
(6) This Part shall not apply where a company is wound up voluntarily merely for the
purposes of reconstruction or of amalgamation with another company.
44. Duty to give necessary information to third parties
(1) In the event of any person becoming bankrupt or making a composition or
arrangement with his creditors, or in the event of an order being made under the Insolvency Act
in respect of the estate of any person, or in the event of a winding-up order being made, or a
resolution for a voluntary winding-up being passed, with respect to any company, or of a
receiver or manager of the company's business or undertaking being duly appointed or of
possession being taken by or on behalf of the holders of any debentures secured by a floating
charge of any property comprised in or subject to the charge it shall be the duty of the bankrupt,
debtor, personal representative of the deceased debtor or company, and, as the case may be,
of the trustee in bankruptcy, trustee, liquidator, receiver, or manager or person in possession of
the property to give at the request of any person claiming that the bankrupt, debtor, deceased
debtor, or company is under a liability to him such information as may reasonably be required by
him for the purpose of ascertaining whether any rights have been transferred to and vested in
him by this Part and for the purpose of enforcing such rights, if any, and any contract of
insurance, in so far as it purports, whether directly or indirectly, to avoid the contract or to alter
the rights of the parties thereunder upon the giving of any such information in the events
aforesaid or otherwise to prohibit or prevent the giving thereof in the said events shall be of no
effect.
(2) If the information given to any person in pursuance of subsection (1) discloses
reasonable ground for supposing that there have or may have been transferred to him under
this Part rights against any particular insurer, that insurer shall be subject to the same duty as is
imposed by subsection (1) on the persons therein mentioned.
(3) The duty to give information imposed by this section shall include a duty to allow all
contracts of insurance, receipts for premiums, and other relevant documents in the possession
or power of the person on whom the duty is so imposed to be inspected and copies thereof to
be taken.
45. Settlement between insurers and insured persons
Where the insured has become bankrupt or where in the case of the insured being a
company, a winding-up order has been made or a resolution for a voluntary winding-up has
been passed, with respect to the company, no agreement made between the insurer and the
insured after liability has been incurred to a third party and after the commencement of the
bankruptcy or winding-up, as the case may be, nor any waiver, assignment, or other disposition
made by, or payment made to the insured after the commencement aforesaid shall be effective
to defeat or affect the rights transferred to the third party under this Part, but those rights shall

be the same as if no such agreement, waiver, assignment, disposition or payment had been
made.
PART VII
Licensing Requirements of Insurance Brokers, Insurance Agents
and Agents for Brokers (ss 46-64)
46. Insurance brokers, agents and agents for brokers to be licensed
(1) - (2) ...... (3) An employee of a licensed insurance broker may accept insurance
business without himself being licensed provided the compensation of such employee is not
related to the volume of business so handled.
(4) An employee of a licensed insurance agent or agent for an insurance broker may-
(a) accept over the counter insurance business at the permanent office of such agent
without being licensed:
Provided that the compensation of such employee is not related to the volume of
business so handled;
(b) accept insurance business elsewhere than at the permanent office of such agent
without being licensed:
Provided that such employee carries an identity card issued in accordance with the
provisions of subsection (3) of section 49 and he accepts only such insurances as are
compulsorily required under any other law of Botswana.
i
47. Agents to act for one principal only *
No insurance agent or agent for an insurance broker may act-
(a) for more than one insurer or broker licensed under this Act;
(b) outside the terms of an approved agency agreement.
48. Insurer's and broker's responsibility for agents
(1) An insurer or an insurance broker shall be liable for the acts of an agent or an
employee of an agent in carrying out his duties as an agent where the act complained of falls
within the area of authority of the agent or his employee as is explicitly stated in his agency
certificate or might reasonably be implied from it by a person seeking insurance.
(2) Insofar as it affects a policyholder or potential policyholder, all premiums paid to an
agent or an employee of an agent shall be deemed to have been paid to the insurer or broker
for whom he is the agent.
(3) Nothing contained in this section shall prevent an insurer or a broker from seeking
redress against an agent or employee of an agent, or both, as a result of such insurer or broker
incurring an expense or liability which, but for the provisions of this section, they would not
otherwise have incurred.
(4) Nothing contained in this section shall prevent an agent seeking redress against his
employee where an insurer or broker incurs an expense or liability under subsections (1) and (2)
and where the said agent is similarly liable to the insurer or broker under the provisions of
subsection (3).
49. Licensing of agents
(1) The Minister may make regulations setting down the minimum qualifications required
of any person to whom an agency agreement and certificate may be issued by an insurer or
insurance broker.
(2) An insurer or broker employing an agent shall issue to that agent a form of agency
agreement approved by the Registrar agreement shall only be issued to an agent who has
complied with the provisions of this Act.
(3) Every insurer and broker shall issue to each agent and each employee of an agent
identity cards of a type approved by the Registrar stating the name of the insurer or broker, the
class or classes of business the agent or employee of the agent is empowered to transact,
whether he is empowered to effect insurance cover and collect premiums, and the name,
address and a photograph of the agent, or employee of an agent approved by the insurer or

broker as eligible to undertake business as defined under subsection (4)(b) of section 46.
(4) Insurers and brokers shall maintain-
(a) records of all agency agreements issued in accordance with subsection (2); and
(b) duplicate copies of all identity cards issued in accordance with subsection (3).
(5) Every insurance agent applying to the Registrar for a licence shall apply in the
prescribed form and shall provide such additional documentation and information as the
Registrar may require.
(6) The Registrar may stipulate such amendments as he considers necessary to such
documentation to ensure that they comply with the requirements of the Act.
(7) The Registrar may refuse to register or may cancel the licence of any agent who, in
his opinion, does not possess the qualifications set down by the Minister.
49A. Renewal of licensing of an agent (1) Every agent shall, immediately after a period of
12 months has expired from his initial licence, apply to the Registrar in such form as may be
prescribed to renew such licence for a further period of 12 months.
(2) An agent shall thereafter apply to the Registrar to renew his licence whenever a
period of 12 months has expired from his previous renewal of licence.
(3) Where an agent does not renew his licence when it expires, he shall pay, to the
Registrar, a penalty of P150 per day during the period he does not renew his licence, which
period shall not exceed three months.
(4) Where an agent does not renew his licence within three months of its expiry, the
Registrar shall cancel that licence.
(5) Where the licence of an agent is cancelled, the agent shall re-apply for a licence,
which re-application shall be treated as a new application for a licence.
50. ...... 51. Restriction on broker's officers
No insurance broker may employ as its manager, controller or principal officer any
person who-
(a) has been adjudged an undischarged bankrupt in any country;
(b) has made an assignment to or arrangement or composition with creditors which has
not been rescinded or set aside;
(c) has been convicted by any court in any country of an offence involving dishonesty; or
(d) is, in the opinion of the Registrar, an unfit person to hold the office.
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52. Licensing requirements of insurance brokers *
An insurance broker seeking a licence shall satisfy the Registrar-
(a) if it is a limited company, that-
(i) it is a company registered under the Companies Act;
(ii) it has a principal office in Botswana;
(iii) its controller, manager, principal officer and directors who handle the day to day
management of the company are all resident in Botswana; and
(iv) its controller, manager and principal officer are persons with sufficient business
and insurance knowledge and experience.
(b) ......
52A. Renewal of licence of an insurance broker (1) Every insurance broker shall,
immediately after a period of 12 months has expired from his initial licensing, apply to the
Registrar in such form as may be prescribed to renew such licence for a further period of 12
months.
(2) An insurance broker shall thereafter apply to the Registrar to renew his licence
whenever a period of 12 months has expired from his previous renewal of licence.
(3) Where an insurance broker does not renew his licence when it expires, he shall pay,
to the Registrar, a penalty of P150 per day during the period he does not renew his licence,
which period shall not exceed three months.
(4) Where an insurance broker does not renew his licence within three months of its

expiry, the Registrar shall cancel that licence.
(5) Where the licence of an insurance broker is cancelled, the insurance broker shall
re-apply for a licence, which re-application shall be treated as a new application for a licence.
53. Grant of broker's application
If the Registrar is satisfied that-
(a) the relevant bank deposits and capital requirements for the insurance broker are
adequate having regard to any regulations made in relation thereto under section 54;
(b) the relevant trust accounts will be operated in a satisfactory manner in accordance with
section 57;
(c) insurances necessarily required under section 55 have been obtained by the applicant;
and
(d) the applicant complies with the requirements of Part VII of this Act,
the Registrar may grant the application for a licence as a broker and issue the prescribed
licensing certificate.
iii
54. Broker's capital requirements *
(1) The Registrar may, within such limits as the Minister may prescribe by regulations, by
notice in writing, require a broker to deposit either in money or in stipulated securities, security
in a value stipulated by him, within such time as the Registrar may consider reasonable.
(2) The Minister shall, prescribe the minimum paid-up capital to be maintained by a
broker, and any broker who permits its paid-up capital to be reduced to a level below that
prescribed by the Minister shall be guilty of an offence and shall in addition to any other penalty
prescribed by this Act be liable to have its licence cancelled.
55. Broker's responsibilities and insurance requirements
(1) A broker is liable for his acts or omissions and for the acts or omissions of his agents
and staff in transacting insurance business, and shall insure himself against any such liability:
Provided that where the Registrar is satisfied that such insurance cannot be obtained to
cover agents or staff he may exempt the broker from effecting such insurance and instead
require the broker to increase the security, if any, deposited by him under section 54 by such
sum as the Registrar may consider reasonable.
(2) The Registrar may by notice in writing to the broker require him to provide a minimum
indemnity in a stated amount against losses arising as a result of the provisions of subsection
(1) as the Registrar shall consider appropriate but such minimum indemnity shall not be less or
more than that which the Minister may prescribe.
(3) The Registrar may by notice in writing to the insurance broker require him to restrict
the first amount payable by the insurance broker in respect of any claim or series of claims
insured by virtue of the provisions of subsection (1) as the Registrar shall consider appropriate.
56. Broker's records and rights of access
(1) A broker shall maintain records relating to insurance transactions undertaken by it
inside and outside Botswana, for a minimum period of six years after the maturity, cancellation
or realisation of an insurance policy or after the date of loss under such policy as the case may
be.
(2) A broker shall provide access to a client or his authorised legal representative to all
documents and correspondence issued or held by the broker of insurance transactions
undertaken on behalf of the client:
Provided that no person shall be entitled, other than upon the order of a competent
court, to take copies of any such documents or correspondence without the consent of the
broker.
(3) A broker shall not alter, amend, remove or destroy records required to be maintained
under subsection (1) relating to insurance transactions.
57. Broker's responsibility for premiums
(1) A broker shall be liable to a Botswana insurer for all premiums collected by him and

all premiums due to the insurer by virtue of insurances effected at the instruction of the broker.
iv
*(2) A broker shall remit to the insurer all premiums due to the insurer within the time
specified by regulations made under the provisions of this Act.
v
*(3) All moneys received by a broker either from or for a client shall be deposited in a
separate trust account and shall not in any circumstances be mixed with moneys belonging to
the broker; moneys earned by way of interest on sums deposited in such trust accounts shall
accrue to the benefit of the broker:
Provided that the Registrar may accept a guarantee given by a bank registered under
the Banking Act, in lieu of the establishment of a separate trust account, if the guarantee is
addressed to the Registrar and cannot be withdrawn or cancelled except with his written
consent and is for a sum equal to not less than 50 per cent of the gross premium receipts less
commissions received by the broker for the previous financial year or such other greater sum as
the Registrar may stipulate.
vi
*(4) The Registrar may stipulate where trust accounts required by virtue of subsection
(3) may be maintained and in what form they shall be maintained.
58. Broker's accounts
(1) The accounts of every registered broker shall be audited annually by a resident
auditor approved by the Registrar.
(2) The form of an audit referred to in subsection (1) shall be in accordance with the
requirements of the Companies Act and shall contain such other information or such additional
declarations as the Minister may by regulations prescribe.
(3) The auditor shall audit trust accounts maintained by the broker in accordance with
the provisions of subsection (3) of section 57 and shall state in the accounts whether in his
opinion they comply with the provisions of this Act.
(4) Where the Registrar has accepted a guarantee in lieu of the maintenance of a trust
account in accordance with the provisions of subsection (3) of section 57 the broker shall
ensure that a separate record is maintained of all moneys received from or for a client.
59. Cancellation of licence If in the case of any licensed insurance broker, the
Registrar is satisfied that-
(a) the business of the insurance broker is not being conducted in accordance with sound
business principles;
(b) the broker has ceased to carry on insurance broking business in Botswana;
(c) the broker has requested in writing the cancellation of the licence;
(d) the broker is acting or has acted in contravention of any of the provisions of this Act,
the Registrar may give notice in writing to the insurance broker of his intention to cancel the
licence of the said broker apply to the court for the judicial management or winding-up of the
business of the insurance broker in terms of section 123.
60. ...... 61. Financial year end of broker
The financial year of an insurance broker may be changed by the broker with the
approval of the Registrar.
62. Broker's amalgamations, sales and transfers
(1) No transfer, sale, amalgamation, takeover of the ownership of or business of a broker
or other similar arrangement in respect thereof may be entered into by an insurance broker
without the prior written approval of the Registrar.
(2) The Registrar in deciding whether to grant his approval shall primarily consider
whether the terms are in the interest of the clients, or the economy or the insurance industry or
in the public interest.
(3) The Registrar may, as a condition for the granting of his approval, require that such
amendments as he may recommend shall be made to such transfer, sale, amalgamation,
takeover or other similar arrangement.
63. Broker's annual returns to the Registrar

(1) An insurance broker shall, within four months after the end of its financial year,
furnish to the Registrar in the prescribed form-
(a) an audited balance sheet and profit and loss account;
(b) an audited premium income, other income and expenditure statement; and
(c) all such other information as he may require.
(2) The Registrar may, at his discretion, extend the time within which the broker should
comply with the provisions of subsection (1) by a maximum of three months:
Provided that a broker shall be liable to pay to the Registrar a penalty of P150 for every
day during which he is in default beyond such extended time granted by the Registrar.
(3) Where the broker fails to furnish the required documents and information within the
extended time or fails to pay the penalty, the broker shall be regarded as having failed to comply
with the provisions of subsection (1).
64. Insurance brokers' code of conduct
(1) The Minister may by regulations set out a code of conduct and a guide for insurance
brokers in the conduct of their business:
Provided that a broker may in an extraordinary case undertake practices discouraged by
the code, but shall submit his reasons for so doing, in writing, to the Registrar as soon as
practicable thereafter.
(2) The principal officer of each broker shall ensure that all directors, managers, agents
and employees of the broker are made aware of, and comply with, the provisions of the code of
conduct described in subsection (1).
(3) A copy of the code of conduct described in subsection (1) shall be prominently
displayed in areas of access to the public at each office of the broker.
PART VIII
Special Provisions relating to Long Term (Life)
and other Policies (ss 65-102)
65. Life insurance tables
(1) Every insurer licensed to transact long term insurance business shall, within three
months from the commencement of this Act or, in the event of subsequent alteration within one
month from the implementation of such alteration, furnish the Registrar with-
(a) a copy of every printed standard policy document and standard endorsements and
every table or statement of the rates of premium which he ordinarily charges and of the
benefits including paid-up and surrender values which the insurer ordinarily undertakes
to grant in respect of policies insuring normal lives; and
(b) a report from an actuary approved by the Registrar that any table or statement
submitted by virtue of paragraph (a) is actuarially sound.
(2) No insurer shall make use of any policy document, table or statement in the conduct
of its long term business referred to in subsection (1), unless an actuary approved by the
Registrar has reported that it is actuarially sound.
(3) No insurer shall make use of any policy document, table or statement in the conduct
of its long term business referred to in subsection (1) if-
(a) the basis of payment to or remuneration of the insurer is other than by a charge upon
the relevant life insurance fund of the management costs actually incurred together
with a proportion of any established surplus as provided in section 75 from that life
insurance fund to such insurer; and
(b) the approval of the Registrar has not been sought and obtained in writing to any
alternative defined basis or formula of payment to or remuneration of the insurer.
(4) For the purposes of subsection (3)(b) any investment unit policy where policyholders
purchase investment units shall be deemed to require the insurer to seek the approval of the
Registrar under the said subsection (3)(b).
66. Insurable interest essential for all policies

(1) Subject to the provisions of this Act, no policy of insurance shall be issued on the life
or lives of any person or persons, or on any other event or events whatsoever, wherein the
person or persons for whose use, benefit, or on whose account such policy or policies shall be
made, shall have no insurable interest.
(2) An insurable interest shall be deemed to be had by-
(a) a parent of a minor or the guardian of a minor but only to the extent as provided by
section 77;
(b) a husband, on the life of his wife;
(c) a wife, on the life of her husband;
(d) any person, on the life of another upon whom he is wholly or in part dependent for
support or education;
(e) a company or other person, on the life of an officer or employee thereof; and
(f) a person who has a pecuniary interest in the duration of the life of another person, in
the life of that person to the extent only of that pecuniary interest at the outset.
67. - 68. ...... 69. Periodic actuarial investigations
(1) A licensed insurer carrying on long term business shall cause an investigation to be
made into the financial position of the insurer and of each life insurance fund established by it
including a valuation of their individual liabilities by an actuary approved by the Registrar-
(a) once in every three years or at such shorter intervals as may be prescribed or required
by the Registrar; and
(b) prior to an insurer wishing to distribute profits or transfer sums from the life insurance
fund other than payments and investments under long term business or management
costs actually incurred.
(2) The actuarial investigation referred to in subsection (1) shall be completed within six
months of the expiry of the period to which it relates or within such extended time as the
Registrar may allow:
Provided that the insurer shall, unless the Registrar in his sole discretion decides
otherwise, be liable to a penalty of P50 for every day of such extended time granted by the
Registrar.
(3) The failure of the insurer to complete the investigation within the time stipulated
under subsection (2) shall constitute an offence under this Act.
(4) For the purposes of any investigation undertaken in accordance with the provisions
of subsection (1) the value of any assets and the amount of any liability shall be determined in
accordance with such method of valuation as may be prescribed.
(5) An actuary conducting an investigation undertaken in accordance with the provisions
of this section shall submit to the Registrar within three months of the completion of his
investigation an abstract the form and content of which shall be as prescribed.
70. Establishment of statutory life insurance fund
(1) An insurer carrying on long term insurance business after the date on which this Act
comes into force shall, as at the date of commencement of its next financial year, or as at the
date of the commencement of that business, establish and maintain a statutory life insurance
fund (in this Act to be known as the "life insurance fund"), under an appropriate name in respect
of the long term insurance business carried on by it.
(2) An insurer may establish and maintain a separate life insurance fund, under an
appropriate name, in respect of any class or classes of its long term insurance business:
Provided that where an insurer establishes a separate life insurance fund in respect of a
part of the long term insurance business of the insurer, the insurer shall forthwith notify the
Registrar in writing of the establishment of the fund, the date from which the fund is established,
the part of the long terminsurance business of the insurer in respect of which the fund is
established and the name of the fund.
(3) Where an insurer carries on long term insurance business of more than one class,

the Registrar may in writing direct the insurer-
(a) to establish, maintain and appropriately name one or more separate funds in respect of
any class or classes of long term insurance business carried on by it;
(b) to maintain an account in respect of each of those classes of long term insurance
business;
(c) to maintain separate life and annuity funds within such limits as he shall from time to
time advise.
(4) All amounts received by an insurer in respect of any class of long term insurance
business, after the establishment by the insurer of a life insurance fund under this section, shall
be carried to that fund.
(5) Where, at any time-
(a) an insurer is maintaining more than one life insurance fund in respect of his long term
insurance business; and
(b) a particular policy ceases to be included in the part of the long term insurance business
of the insurer in respect of which one of the life insurance funds is maintained (in this
subsection referred to as "the first fund") and is transferred to another part of the long
term insurance business of the insurer in respect of which another of the life insurance
funds is maintained (in this subsection referred to as "the second fund"),
the insurer shall forthwith-
(i) transfer from the first fund to the second fund assets equal to the liability on the policy
at that time as ascertained by an actuary approved by the Registrar; and
(ii) transfer from the assets of the insurer to the second fund an amount equivalent to that
amount by which the assets accruing to that policy from the first fund are less than the
liability on such policy.
(6) The income arising from the investment of the assets of a life insurance fund shall be
carried to and form part of that fund.
(7) The assets of each life insurance fund shall be kept distinct and separate from all
other assets of the insurer.
(8) An insurer carrying on long term insurance business shall maintain such books of
account and other records as are necessary for identifying-
(a) the assets representing each life insurance fund maintained by the insurer under this
section;
(b) the liabilities attributable to that class or, as the case may be, each of those classes of
long term insurance business.
71. Application of assets of insurer with long term business
(1) Subject to subsections (2) and (4), the assets representing the life insurance fund or
funds maintained by an insurer licensed to transact long term business-
(a) shall be applicable only for the purposes of that business; and
(b) shall not be transferred so as to be available for other purposes of the company except
where the transfer constitutes reimbursement of expenditure borne by other assets (in
the same or the last preceding financial year), in discharging liabilities wholly or partly
attributable to long term business.
(2) Where the value of the assets mentioned in subsection (1) is shown by an actuarial
investigation to exceed the amount of the liabilities attributable to the company's long term
business the restriction imposed by that subsection shall not apply to so much of those assets
as represents the excess.
(3) Subsection (2) shall not authorise a transfer or other application of assets by
reference to an actuarial investigation at any time after the date of commencement of the
investigation and before 30 days after the date when the abstract of the actuary's report
required under the terms of section 69 has been deposited with the Registrar.
(4) Nothing in subsection (1) shall preclude an insurer from exchanging, at fair market

value, assets representing a life insurance fund maintained by the company in respect of its
long term business for other assets of the company or a company connected with it.
(5) Any mortgage or charge including a charge imposed by a court on the application of
a judgment creditor, shall be void to the extent to which it contravenes subsection (1).
(6) The assets of a life insurance fund maintained by a company in respect of its long
term business may not be used for the purposes of any other business of the company or of a
company connected with it notwithstanding any arrangement for its subsequent repayment out
of the receipts of that other business.
(7) An insurer acting in contravention of subsection (1) shall be guilty of an offence under
this Act.
(8) Every director, manager, controller and principal officer of an insurer shall be under
the same civil liability, in the event of a contravention of the provisions of subsection (1), as if he
had been a trustee under a trust for the execution of those provisions in respect of that fund,
and as if the appropriate policyholders had been beneficiaries of such a trust, unless the
director, manager, controller or principal officer proves that the contravention occurred without
his knowledge and that he used all due diligence to prevent the contravention.
(9) No insurer to which this Part of the Act applies, and no company of which an insurer
is a subsidiary, shall declare a dividend at any time when the value of the assets representing
the life insurance fund or funds maintained by the insurer in respect of its long term business, as
determined in accordance with any applicable valuation regulations, is less than the amount of
the liabilities attributable to that business as so determined.
72. Restriction on transaction with connected persons
(1) Neither an insurer which transacts long term business nor a subordinate company of
any such insurer shall enter into a transaction to which this section applies-
(a) at a time when the aggregate of the value of the assets and the amount of the liabilities
attributable to such transactions already entered into by the insurer and its subordinate
companies exceeds the prescribed percentage of the total amount standing to the
credit of the insurer's life insurance funds; or
(b) at any other time when the aggregate of the value of those assets and the amount of
those liabilities would exceed that percentage if the transaction were entered into.
(2) This section applies to any transaction entered into by any such insurer as is
mentioned in subsection (1), (whether or not itself a subordinate company of another company),
being a transaction under which-
(a) a person connected with the insurer will owe it money;
(b) the insurer acquires shares in a company which is a person connected with it; or
(c) the insurer undertakes a liability to meet an obligation of a person connected with it or
to help such a person to meet an obligation,
if the right to receive the money would constitute a long term asset of the insurer, the acquisition
is made out of its life insurance funds or the liability would fall to be discharged out of those
funds, as the case may be.
(3) Without prejudice to subsection (2), this section applies to any transaction entered
into by a subordinate company of any such insurer as is mentioned in subsection (1), being a
transaction under which-
(a) the insurer or a person connected with it will owe money to the subordinate company
(not being money owed by the insurer which can be properly paid out of its life
insurance funds);
(b) the subordinate company acquires shares in the insurer or in a company which is a
person connected with the insurer; or
(c) the subordinate company undertakes a liability to meet an obligation of the insurer or of
a person connected with that company or to help the insurer or such a person to meet
an obligation,

but where the subordinate company is itself an insurer as is mentioned in subsection (1), this
section shall not by virtue of this subsection apply to any such transaction if the right to receive
the money would constitute a long term asset of the subordinate company, the acquisition is
made out of its life insurance funds or the liability would fall to be discharged out of those funds,
as the case may be.
(4) In this section "subordinate company", in relation to any such insurer as is mentioned
in subsection (1), means-
(a) a company having equity share capital some or all of which is held by the insurer as
part of its long term assets where the share capital so held by the insurer-
(i) amounts to more than half in nominal value of that share capital; and
(ii) confers on the insurer the power to appoint or remove the holders of all or a
majority of the directorships of the company whose share capital is held and more
than one half of the voting power at any general meeting of that company;
(b) a company having equity share capital some or all of which is held by another
company which is itself a subordinate company of the insurer where the share capital
held by that other company-
(i) amounts to more than half in nominal value of that share capital; and
(ii) confers on that other company the power to appoint or remove the holders of all or
a majority of the directorships of the company whose share capital is held and
more than one half of the voting power at any general meeting of that company,
and for the purposes of this subsection share capital held for any person by a nominee
shall (except where that person is connected only in a fiduciary capacity) be treated as
held by that person, and share capital held by a person in a fiduciary capacity or by
way of security shall be treated as not held by that person.
(5) For the purposes of this section a person is connected with any such insurer as is
mentioned in subsection (1) if that person is not a subordinate company of the insurer but-
(a) controls, or is a partner of a person who controls, the insurer;
(b) being a company, is controlled by the insurer or by another person who also controls
the insurer; or
(c) is a director of the insurer or the wife or husband or a minor son or daughter of such a
director;
and for the purposes of this subsection a person controls a company if he is a controller of it
within the meaning of this Act.
(6) For the purposes of this section the value of any assets and the amount of any
liabilities shall be determined in accordance with any applicable valuation regulations.
(7) In this section-
"company", except in the expression "insurer", includes any body corporate;
"equity share capital" means, in relation to a company, its issued share capital excluding
any part thereof which, neither as respects dividends nor as respects capital, carries any right to
participate beyond a specified amount in a distribution;
"liability" includes a contingent liability;
"long term assets" and "life insurance funds", in relation to an insurer, mean respectively
assets representing the fund or funds maintained by the insurer in respect of its long term
insurance business and that fund or those funds;
"the prescribed percentage" means five per cent or such greater percentage as may be
defined elsewhere in this Act or prescribed by regulations;
"share" has the same meaning as in the Companies Act;
"son" includes step-son, and "daughter" includes step-daughter.
(8) This section shall not be construed as making any transaction unenforceable as
between parties thereto or as otherwise making unenforceable any rights or liabilities in respect
of property.

73. Exemption: Botswana Development Corporation
For the purposes of section 72 the prescribed percentage shall read "15 per cent" in
respect of transactions described by subsection (1) in which the connected person, defined by
subsection (5) of that section, is the Botswana Development Corporation, or any of its directors
or employees for the time being in that capacity.
74. Reinsurance contracts of long term insurers
An insurer transacting long term business in Botswana shall not enter into a contract of
reinsurance against any liability of its long term business in Botswana otherwise than with a long
term insurer or reinsurer approved by the Registrar.
75. Allocations to policyholders
(1) Where in the case of an insurer transacting long term business-
(a) there is an established surplus in a life insurance fund in which both the insurer and the
long term policyholders of any category are eligible to participate; and
(b) an amount has been allocated to policyholders of that category in respect of a
previously established surplus in which policyholders of that category were eligible to
participate,
the insurer shall not by virtue of subsection (2) of section 71 transfer or otherwise apply assets
representing any part of the surplus mentioned in paragraph (a) of this subsection unless the
insurer has either allocated to policyholders of that category in respect of that surplus an
amount not less than 90 per cent or complied with the requirements of subsection (2) and made
to those policyholders any allocation of which notice is given under paragraph (a) of that
subsection.
(2) The requirements of this subsection are that the insurer-
(a) has served on the Registrar a written notice stating that it proposes to make no
allocation or an allocation of an amount, specifying it, which is smaller than 90 per cent;
and
(b) has published a statement approved by the Registrar in the Gazette,
and that a period of not less than two months has elapsed since the date, or the last date, on
which the company has published the statement mentioned in paragraph (b) as required by or
under that paragraph.
(3) In this section-
"established surplus" means an excess of assets representing the whole or a particular
part of the life insurance fund or funds maintained by the insurer in respect of its long term
business over the liabilities, or a particular part of the liabilities, of the company attributable to
that business as shown by an investigation to which section 69 applies.
(4) For the purposes of this section an amount is allocated to policyholders if, and only if-
(a) bonus payments are made to them; or
(b) reversionary bonuses are declared in their favour or a reduction is made in the
premiums payable by them,
and the amount of the allocation is, in a case within paragraph (a) of this subsection, the amount
of the payments and, in a case within paragraph (b), the amount of the liabilities assumed by the
insurer in consequence of the declaration or reduction.
(5) For the purposes of this section the amount of any bonus payments made in
anticipation of an established surplus shall be treated as an amount allocated in respect of the
next established surplus in respect of which amount is allocated to eligible policyholders
generally; and for the purposes of subsection (2) the amount of any surplus in respect of which
such an allocation is made shall be treated as increased by the amount of any such payments.
(6) Subsection (1) shall not authorize the application for purposes other than those
mentioned in subsection (1) of section 71 of assets representing any part of the surplus
mentioned in subsection (1)(a) of this section which the insurer has decided to carry forward
unappropriated; and for the purpose, of subsection (2) of section 71 the amount of any surplus

shall be treated as reduced by any part thereof which the company has decided to carry forward
as aforesaid.
(7) For the purposes of subsection (1) policyholders shall be taken to be eligible to
participate in an established surplus in any case where they would be eligible to participate in a
later established surplus representing it if it were carried forward unappropriated.
(8) This section shall not apply to the long term insurance business of the insurer under
which policyholders purchase investment units in an investment unit policy.
76. Investment unit policies
(1) Other than as approved by the Registrar under the provisions of subsection (3)(b) of
section 65-
(a) all investment units purchased and all assets and income belonging thereto shall be
held solely to the benefit of the policyholders; and
(b) no insurer or other person may levy or charge any commission or fee upon a
policyholder participating in an investment unit policy or upon the relevant life
insurance fund for the purchase, administration or sale of such investment units.
(2) For the purposes of this Act, any alteration to the value of any holding of a unit or
units, or other beneficial interest, shall be known as the "adjusted unit value".
77. Life insurance of minors
(1) A minor or a parent or the guardian of a minor may effect a life policy upon his life
and pay the premiums due under the policy with money lawfully at the disposal of the minor, his
parents or guardian:
Provided that-
(i) no benefit shall be paid other than as a result of death of the minor, a parent or a
guardian if the minor has not attained 16 years of age;
(ii) the total sums payable against all life insurance policies outstanding at that time on the
life of a minor who dies before he attains the age of 16 years shall not exceed P2 000,
or the sum of the total of the premiums paid under such policy, whichever is greater,
and where there are more policies than one outstanding at that time a contribution shall
be due against each policy to make up the total sum of P2 000, or such greater sum as
the case may be, in proportion to the sum for which the policy is effected;
(iii) a minor who has attained the age of 16 years may, without the consent of his parent or
guardian, effect a life policy upon his own life and shall be as competent in all respects
to be a policy owner and to have and exercise all the powers and privileges of a policy
holder in relation to the policy as if he were of adult age, except that he shall not while
he is still a minor pledge or cede the policy without the written consent of his parent or
guardian.
(2) Notwithstanding the provisions of subsection (1), an insurer shall not pay any sum on
the death of a child before he attains the age of 16 years, except upon production of a certificate
of death issued by the Registrar of Births and Deaths.
(3) For the purposes of this section the Registrar may by notice in writing to each insurer
direct procedures to be undertaken in the processing of claims against such insurers on the
death of minors.
78. Value of certain assets
Where an asset was acquired wholly or partly from money paid by an insurer under a life
policy and the proceeds, on realisation of that asset exceed that amount, a reference in this Part
to the proceeds on realisation or to the value of that asset shall be construed as a reference to
that amount only and not any sum in excess thereof.
79. Life policy effected by married persons
(1) Notwithstanding any provision of any law to the contrary, but subject to the provisions
of this Part-
(a) a married woman may in all respects as if she were a single woman of adult age and

capacity-
(i) effect and own a life policy;
(ii) hold and, by way of gift or otherwise, acquire from or dispose of to any person,
including her husband, any interest in a life policy;
(iii) hold any moneys paid by the insurer in respect of any interest held by her in a life
policy or any assets acquired by her with those moneys;
(iv) hold any moneys or assets acquired by her in respect of the disposal of any
interest held by her in a life policy or any assets acquired by her with those
moneys; and
(v) dispose of to any person, including her husband, by way of a gift or otherwise, any
moneys or assets referred to in subparagraphs (iii) and (iv);
(b) a man married out of community of property may, in all respects as if he were a single
man of adult age and capacity, by way of gift, acquire from or dispose of to his wife-
(i) any interest in a life policy;
(ii) any moneys paid by the insurer in respect of any interest in a life policy or any
assets acquired with those moneys; and
(iii) any moneys or assets acquired in respect of the disposal of any interest in a life
policy or any assets acquired with those moneys.
(2) For the purposes of this Part a man married in community of property may, in all
respects as if he were a single man of adult age and capacity, and subject to the provisions of
this Part-
(a) dispose of to his wife, by way of a gift or otherwise-
(i) his share in any interest in a life policy effected or held by him on behalf of such
community;
(ii) any moneys paid by the insurer in respect of his share in any interest under
subparagraph (i) or any assets acquired with those moneys; and
(iii) any moneys or assets acquired in respect of the disposal of any interest under
subparagraph (i) or any assets acquired with those moneys; and
(b) acquire from his wife, by way of gift or otherwise, and hold and dispose of for his own
benefit any moneys or assets under subsection (1)(a)(v).
(3) The provisions of subsection (1)(a) shall also apply to a married woman in relation to-
(a) a life policy effected prior to her marriage;
(b) any interest in a life policy acquired prior to her marriage;
(c) any moneys due or paid to her prior to her marriage in respect of a life policy under
paragraph (a), or any interest in a life policy under paragraph (b), or acquired by her
prior to her marriage in respect of the disposal of any interest in a life policy; and
(d) any assets acquired prior to her marriage with moneys under paragraph (c),
as if the policy, interest, moneys or assets were effected or paid to or acquired by her or
became due during her marriage.
(4) The Registrar may make copies of portions or the whole of any document or
information produced under subsection (1) and may require the principal officer of an insurer,
broker, agent or applicant for a licence to provide any further information, as may be required by
the Registrar, in relation to any such document or information.
(5) The Registrar or any other person authorised to act on his behalf may enter the
premises of any insurer, broker, agent or applicant for a licence, if it appears to him that there
are reasonable grounds for suspecting that there is at the premises of such persons any
document or information relating to or concerning the insurance business of such person, with
respect to which-
(a) any offence has been, or is suspected on reasonable grounds to have been,
committed;
(b) there are reasonable grounds for believing that it will afford evidence as to the

commission of any offence; or
(c) there are reasonable grounds for believing that it is intended to be used for the purpose
of committing any offence,
in order to search the premises, or to take possession of such documents or information, or to
take any other step which may appear necessary for preserving such documents or information
or for preventing any interference therewith.
(6) Any action taken by the Registrar or any other person authorised to act on his behalf
in accordance with subsection (5) shall, as far as possible, be taken in the day time and in the
presence of two or more persons.
(7) Any document or information that has been seized by the Registrar or any other
person authorised to act on his behalf under this section may be retained for a period of three
months and shall remain absolutely privileged during that period.
(8) Any costs incurred during any investigation carried out by the Registrar or any other
person authorised to act on his behalf in accordance with this section shall be borne by the
person who is the subject of the investigation, unless it is found that no breach of this Act has
been committed.
80. Life policy on own life: protection afforded during life
(1) If a life policy effected by a person, whether married or not, on his own life which has
inured for three years or longer from the date of the payment of the first premium-
(a) is attached in execution of a judgment or order of any court at the instance of a creditor
of that person; or
(b) becomes part of that person's estate in insolvency and, if that person is married in
community of property, of the joint estate of the insolvent and surviving spouse,
during the lifetime of that person, the proceeds on realization of the policy shall, to the extent
specified in subsection (2), be protected against that person's creditors and against any claim in
connection with such attachment or such insolvency.
(2) The protection afforded by the provisions of subsection (1) in respect of a life policy
referred to therein-
(a) shall extend to so much of the proceeds on realization of the policy as does not exceed
an amount of P5 000; and
(b) shall, subject to the provisions of paragraph (a), extend, if the policy is pledged, to so
much of the proceeds on realization of the policy as exceeds the amount of the liability,
the payment of which the pledge secures, but no further.
(3) During a period of five years as from the date upon which any moneys become due
or have been paid by the insurer under a life policy under subsection (1) or assets acquired with
those moneys or with those moneys and other moneys-
(a) are attached in execution of a judgment or order of any court at the instance of a
creditor or a person by whom the policy was effected; or
(b) become part of the estate in the insolvency of the person by whom the policy was
effected and, if that person is married in community of property, of the joint estate of
the insolvent and the surviving spouse,
the moneys due or paid under the policy or the proceeds on realization of the assets shall, to
the extent specified in subsection (4), be protected against that person's creditors and against
any claim in connection with the attachment or the insolvency.
(4) The protection afforded under subsection (3) in respect of moneys or assets of a
person referred to in that subsection-
(a) shall extend to those moneys or to the proceeds on realization of those assets in so far
as those moneys and proceeds, together with-
(i) all other moneys due or paid to that person under life policies under subsection
(1);
(ii) the value of all other existing assets of that person acquired with moneys paid

under life policies under subsection (1) or with such moneys and other moneys;
and
(iii) the realizable value of all life policies under subsection (1) of which that person is
the owner,
do not exceed P5 000;
(b) shall, subject to the provisions of paragraph (a), extend, in the case of an asset which
is pledged or mortgaged, to so much of the proceeds on realization of the assets as
exceeds the amount of the liability, the payment of which the pledge or mortgage
secures, but no further; and
(c) shall not extend to any moneys due or paid under a life policy under subsection (1) on
surrender of the policy or to any assets acquired with those moneys or with those
moneys and other moneys.
(5) For the purposes of this section-
(a) a life policy which an insurer issues in exchange for or in consideration of the surrender
of another life policy under which the insurer was previously liable shall be regarded as
having been effected on the date on which the surrendered policy was issued if the
insurer received no payment other than the value of the surrender policy as a
consideration for the new policy; and
(b) a life policy which an insurer issued under section 86 shall be regarded as having been
effected on the date on which the old life policy for which it was substituted was issued.
81. Life policy on own life: protection afforded on death
(1) For the purposes of this section "beneficiary" means-
(a) the surviving spouse of an owner;
(b) a dependant under the will of an owner;
(c) a dependant by right of succession on intestacy; or
(d) a dependant under or by virtue of an order made in accordance with the provisions of
any enactment in Botswana relating to inheritance or succession.
(2) If-
(a) a beneficiary has, on the death of the owner, a claim-
(i) under a life policy; or
(ii) to moneys or assets,
in respect of which protection is afforded under section 80; and
(b) the life policy, moneys or assets referred to in paragraph (a)-
(i) are attached in execution of a judgment or order of any court at the instance of a
creditor of the deceased owner; or
(ii) become part of the deceased owner's estate in insolvency and, if the deceased
owner was married in community of property, of the joint estate of the deceased
insolvent and the surviving spouse,
the beneficiary shall, in respect of his claim, enjoy the protection afforded under section
80.
82. Protection afforded in respect of life policy inuring to spouse or children
(1) If-
(a) before or during marriage, a man effects or cedes for the benefit of his wife or his wife
and children, including children to be born to him and his wife, or any of them;
(b) before or during marriage, a woman effects or cedes for the benefit of her husband or
her husband and children, including children to be born to her and her husband, or any
of them; or
(c) a person effects or cedes for the benefit of his or her children, including children to be
born to him or her,
a life policy on his or her life or his or her spouse, the policy or moneys due or paid thereunder
by the insurer or any asset acquired with those moneys shall not, subject to the provisions of

this section and, in the case of a policy which is ceded, to the terms of the cession-
(i) be liable to be attached in execution of a judgment or order of any court at the
instance of a creditor of the person by whom the policy was effected or ceded; or
(ii) form part of the estate in insolvency of the person by whom the policy was effected
or ceded and, if that person is married in community of property, of the joint estate
of the insolvent and the surviving spouse.
(2) A benefit conferred or purported to be conferred upon a spouse or child under a life
policy under subsection (1) or by virtue of the cession of a life policy under that subsection shall,
notwithstanding any agreement to the contrary between the insurer and the person by whom the
policy was effected, but subject, in the case of a policy which is ceded, to the terms of the
cession, be enforceable against the insurer liable under the policy at the suit of the spouse or
child or the legal representative of the spouse or child, notwithstanding the spouse or child has
not accepted the benefit and is not a party to the contract of insurance.
(3) A life policy shall not be treated for the purposes of this section as having been
effected for the benefit of the spouse and, additionally or alternatively, the children, including
unborn children, or any of them, of the person by whom the policy was effected unless, at the
time of its issue the policy expressly so provides, or it was ceded for their benefit not less than
12 months prior to his being declared insolvent.
83. Protection afforded in respect of life policy inuring to wife
(1) If, before or during marriage, a man effects or cedes for the benefit of his wife a life
policy on his or her life and the policy-
(a) is attached in execution of a judgment or order of any court at the instance of her
creditors; or
(b) becomes part of her estate in insolvency,
the proceeds on realization of the policy shall, to the extent specified in subsection (2) of section
80, be protected against her creditors and against any claim in connection with the attachment
or the insolvency.
(2) The provisions of subsections (3), (4) and (5) of section 80, and subsections (2) and
(3) of section 82 shall, mutatis mutandis, apply to a life policy under subsection (1) or moneys
due or paid thereunder by the insurer or any assets acquired with those moneys or with those
moneys and other moneys.
84. Special provisions relating to persons married in community of property
(1) If a premium paid under a life policy effected by a spouse married in community of
property or in which a spouse married in community of property holds any interest is paid out of
moneys which belong to the joint estate and the liabilities of the spouses continuously exceed
the value of their assets from the time of the payment of the premium until the joint estate is
sequestrated as insolvent, the spouse by whom the policy was effected or who holds the
interest in the policy shall be liable to pay into the estate in insolvency the amount of every such
premium in so far as its payment created or increased the excess of liabilities over assets.
(2) If a woman married in community of property who has effected a life policy or has
acquired or holds any interest in a life policy earns or otherwise lawfully acquires any money
without utilizing for the purpose any assets belonging to the joint estate she may, without her
husband's consent, use that money for the purpose of paying any premium due under the
policy.
(3) Except as is provided in subsection (4), nothing in this section shall be construed as
obliging the husband of a woman married in community of property to pay any premium due
under a life policy referred to in this section out of the joint estate, unless he has undertaken to
do so.
(4) If the husband of a woman married in community of property has effected or ceded
for the benefit of his wife and, additionally or alternatively, children, including unborn children, or
any of them, a life policy on his life or on the life of his wife, he shall be obliged during the

marriage to pay out of the joint estate any premium under the policy so long as the value of the
joint estate exceeds their joint liabilities and, if he fails to make such payment, his wife may,
without the husband's consent, make the payment out of moneys she may have earned or
otherwise lawfully acquired without utilizing for that purpose any assets belonging to her and her
husband jointly or which may otherwise be at her disposal.
85. Selection for realization of life policies in respect of which protection is afforded
(1) If-
(a) two or more life policies or assets in respect of which protection is afforded by the
provisions of sections 80, 81 and 83, being the property of one person, are attached in
execution of a judgment or order of any court at the instance of a creditor; or
(b) the owner of two or more life policies or assets in respect of which protection is
afforded by the provisions of sections 80, 81 and 83 is adjudged or otherwise declared
insolvent,
and a part only of the aggregate realizable value of the policies or assets is protected, the
judgment creditor or the trustee of the estate in insolvency, as the case may be, shall determine
which policy or policies or other assets shall be realized, wholly or in part, in order to make
available to him so much of the aggregate realizable value as is not protected.
86. Partial realization and partial conversion of life policies
(1) A judgment creditor of the owner of a life policy or the trustee of his estate in
insolvency who is entitled to a part of the realizable value of the policy may, if he is in
possession of the policy, deliver it to the insurer who is liable under the policy for the purpose of
the payment to him of the sum to which he is entitled.
(2) If a judgment creditor or trustee referred to in subsection (1) is not in possession of
the life policy to which the provisions of that subsection apply, the owner or any other person in
possession of the policy shall, at the request of the judgment creditor or trustee, deliver it to the
insurer who is liable under the policy for the purpose of the payment to the judgment creditor or
trustee of the sum to which he is entitled.
(3) On receipt of a life policy delivered to it under subsection (1) or (2) the insurer shall-
(a) at the request of the judgment creditor or trustee referred to in subsection (1), pay to
him a sum equal to the part of the realizable value of the policy to which he is entitled;
and
(b) at the request of the owner of the policy, issue to him a new policy of the same class
but for a sum insured equal to the difference between-
(i) the full sum insured under the old policy including any bonus which may have
accrued in connection therewith; and
(ii) an amount which bears the same ratio to the full sum insured under the old policy,
including any bonus, as the amount paid by the insurer to the judgment creditor or
trustee referred to in subsection (1) bears to the full realizable value of the old
policy.
(4) If an insurer has made the payment and issued a new life policy, as is provided in
subsection (3), the old life policy shall lapse.
87. Provisions in case premium on life policy ceded or trust policy cannot be
maintained
If a person who-
(a) has effected or ceded a life policy for the benefit of his spouse and, additionally or
alternatively, children, including unborn children, or any of them; or
(b) holds a life policy in trust for any other person and is obliged to pay the premiums on
the policy,
is or has been unable to pay the premiums, that person may, with the consent of each person
who has an interest in the policy, or, if any such person is a minor, with the consent of his parent
or guardian or the Master of the High Court, agree with the insurer liable under the policy-

(i) to exchange the policy for a paid-up life policy of a value calculated in accordance with
tables furnished to the Registrar under section 65 in the case of normal lives and in any
other case calculated by reference to the said tables and approved by an actuary,
payable at the time and in the manner stipulated in the original policy to the person
entitled to the sum insured by the original policy;
(ii) where the policy so permits, to borrow from the insurer upon the security of the policy
such sums as may be necessary to keep the policy in force or to revive it; or
(iii) to apply any bonus which may have accrued in connection with the policy to a
temporary or permanent reduction of premiums or to the payment of any premiums
which have fallen due.
88. Life policy ceded or premium paid with intent to benefit someone at the expense of
a creditor
(1) Nothing in this Part shall be construed as derogating from the powers of any court to
set aside under the law relating to insolvency any cession of a life policy made with intent to
benefit someone at the expense of a creditor.
(2) If a premium upon a life policy was paid with intent to benefit a person at the expense
of a creditor of the person making the payment, a court may order the owner of the policy to pay
a sum equal to the aggregate of all premiums so paid, with interest at a prescribed rate per
annum on the amount of each premium so paid from the date of its payment, to the person to
whose detriment the premium was to be paid or, if the person has been adjudged or otherwise
declared insolvent, to the trustee of his estate in insolvency.
(3) An order for the payment of a sum of money made under subsection (2) shall have
the effect of pledging the life policy referred to in that subsection to the person entitled to the
payment as security for the payment and, until the payment is made, that person shall be
entitled to possess the policy.
89. Power to pay into court
(1) An insurer may, subject to any rules of court in that behalf, pay into court any moneys
payable by the insurer in respect of a policy for which, in the opinion of the insurer, no sufficient
discharge can otherwise be obtained.
(2) The receipt of a registrar of the court for the moneys shall be a good and valid
discharge to the insurer for moneys so paid in, and the moneys shall, subject to the rules of the
court, be dealt with according to the order of the court.
90. No deductions in respect of other life policies
Where a claim arising under a policy is paid, no deductions shall, except with the
consent in writing of the claimant, be made on account of premiums or debts due to the insurer
under any other policy.
91. Proof of age
(1) A form of proposal shall be framed so as to require a person making a proposal for a
life insurance policy to specify the place and date of birth of the person whose life is proposed to
be insured, and the person making the proposal shall supply those particulars to the best of his
knowledge and belief.
(2) Where an insurer issues a life insurance policy which provides that proof of age of
the life insured is a condition precedent to the payment of the sum insured, the insurer shall,
unless the age of the life insured has already been admitted by it, issue with the policy a printed
notice stating that proof of age of the life insured may be required prior to the payment of the
sum insured.
(3) If an insurer declines to accept the proof of age tendered in respect of a life
insurance policy, whether issued on or after the coming into force of this Act, the policyholder
may apply to the Registrar for an order directing the insurer to accept the proof tendered and if
the Registrar after giving the insurer reasonable opportunity of being heard, makes such order
in writing to the applicant and the insurer, such order shall be binding on the insurer.

(4) The preceding provisions of this section shall not apply to any life insurance policy
issued before the coming into force of this Act or to any paid-up policy or certified copy of a
policy issued on or after the coming into force of this Act, where the life insurance policy issued
replaces a life insurance policy issued before the coming into force of this Act.
(5) Where the provisions of subsection (4) do not apply, the provisions of subsection (6)
shall have effect.
(6) If-
(a) a claim is made for a benefit under a life policy which has inured for a period of three
years from the date of the payment of the first premium;
(b) the age or date of birth of the insured has not been admitted by the insurer liable under
the policy; and
(c) the person claiming the benefit shows that, owing to circumstances beyond the control
and through no default either of himself or of the person by whom the policy was
effected, there was, at no time after the date of the payment of the first premium under
the policy, either in existence or available, any documentary evidence affording
reasonable proof of the age or date of birth of the insured,
any written statement made in the proposal or application for the policy as to the age or date of
birth of the insured shall be accepted for the purposes of the claim as the correct age or date of
birth of the insured, unless the contrary is proved by records of a medical examination of the
insured, made at the request of the insurer, within the period of three years referred to in
paragraph (a) or in any other manner.
92. Age incorrectly stated
(1) A life insurance policy shall not be avoided by reason of a mis-statement of the age
of the life insured, and where-
(a) the true age is proved to be greater than that on which the policy was based, the
insurer may vary the sum insured by, and the bonuses (if any) allotted to the policy, so
that, as varied, they bear the same proportion to the sum insured by, and the bonuses
(if any) allotted to the policy before variation as the amount of the premiums that have
been payable under the policy as issued bears to the amount of the premiums that
would become payable if the policy had been based on the true age;
(b) the true age is proved to be less than that on which the policy was based, the insurer
shall either-
(i) vary the sum insured by, and the bonuses (if any) allotted to, the policy before
variation as the amount of the premiums that have become payable under the
policy as issued bears to the amount of the premiums that would have become
payable if the policy had been based on the true age; or
(ii) reduce, as from the date of issue of the policy, the premium payable to the amount
that would have been payable if the policy had been based on the true age and
repay to the policy owner the amount of over-payments of premiums less any
amount that has been paid as the cash value of bonuses in excess of the cash
value that would have been paid if the policy had been based on the true age:
Provided that, where the correct age is found to be beyond the limits within which
the insurer, according to his published prospectus, issues the type of policies in
question, the policy shall be void ab initio and the insurer shall refund to the insured all
the premiums received on the policy after deducting the commission payments and
expenses incurred by him on the policy; but nothing in this proviso shall apply to
annuities and other policies where the insured has already received any payment
under the policy.
(2) The provisions of subsections (4) and (5) of section 91 shall mutatis mutandis apply
to this section.
93. Suicide

(1) A life policy in which it is stated that the policy shall be void in the event of the
insured, whether sane or insane, dying by his own act or suffering capital punishment within a
stipulated period shall be void-
(a) in respect of any period that exceeds two years from the issue of the policy
notwithstanding any policy conditions to the contrary; or
(b) if the insured dies by his own act or suffers capital punishment after the expiration of
that stipulated period or after two years from the issue of the policy whichever is
sooner.
(2) A life policy in which no provision such as referred to in subsection (1) is contained
shall not be void by reason of the insured, whether sane or insane, dying by his own act or
suffering capital punishment at any time after the issue of the policy.
94. Lost or destroyed life policy
(1) If a life policy is lost or destroyed and the loss or destruction is proved, the insurer
liable under the policy shall, at the request of the policyowner and upon payment by the
policyowner to the insurer of the prescribed fee, issue to the policyowner-
(a) a correct and certified copy of the policy upon which shall be inscribed any
endorsement made by the insurer on the original policy after its issue; and
(b) a correct and certified copy of any record in the possession of the insurer of any
dealings with the policy after its issue.
(2) A certified copy of a life policy issued under subsection (1) shall for all purposes-
(a) take the place of the policy lost or destroyed; and
(b) be the sole evidence of the contract made by the policy.
(3) From the date upon which this Act comes into force an insurer shall maintain a
register of all copies of life policies issued in accordance with subsection (1) and shall allow any
member of the public showing reasonable cause access to relevant parts of the register.
(4) The register referred to in subsection (3) shall contain-
(a) the full name of the life insured;
(b) the full name of the policyowner;
(c) the last known address of the policyowner;
(d) the date of birth or year of birth of the life insured; and
(e) the policy identification number.
95. Life policy may include subsidiary benefits
(1) If an insurer by notice in writing-
(a) informs the Registrar that he has issued or that he intends to issue life policies which
provide benefits-
(i) on the total or partial permanent disability of the person whose life such a policy
insures, or
(ii) on the death of the person whose life such a policy insures as a result of an
accident or particular disease; and
(b) requests the Registrar that the policies referred to in paragraph (a) be treated for the
purposes of this Act as life policies only,
any such policy issued by the insurer on or before the date of commencement of this Act or after
notification to the Registrar shall, subject to the provisions of subsection (2) be treated, for the
purposes of this Act, as a life policy only.
(2) A policy referred to in subsection (1)(a) shall not be treated for the purposes of this
Act as a life policy only if the value of the benefits provided in subsection (1)(a)(i) and (ii) does
not exceed in the aggregate-
(a) a waiver of claims to any premium under the policy in respect of the period of disability;
and
(b) (i) a monthly benefit, payable during the period of disability of the person whose life
the policy insures but not extending beyond the date of termination of the risk of

the life insurance proper effected by the policy, amounting to two per cent of the
sum payable under the policy on the death of the person;
(ii) a lump sum equal to the sum payable under the policy on the death of the person
whose life the policy insures; or
(iii) in the case of a deferred annuity policy, a monthly benefit payable during the
period of the disability of the person whose life the policy insures but not extending
beyond the date as from which the annuity will become payable, amounting to one
twelfth of the annual annuity.
(3) A life policy providing benefits such as are described in subsection (1)(a) which
cannot by reason of the provisions of subsection (2) be treated for the purposes of this Act as a
life policy shall, for the purposes of this Act, be treated as both a life policy and a personal
accident or personal accident and sickness policy.
96. Discrimination between life policies, etc. prohibited
(1) An insurer shall not make or permit to be made any discrimination in respect of the
rate of premiums charged between insurance policies which are of the same kind or the
bonuses granted between life policies which are of the same kind and under which the persons
whose lives are insured have an equal expectation of life.
(2) Nothing in subsection (1) shall apply to insurance policies which-
(a) are reinsurance contracts;
(b) are for large sums in excess of P200 000 at preferential rates in accordance with the
current tariff of the insurer concerned;
(c) insure at preferential rates the lives of employees of one employer or a combination of
employers or members of the families of such employees or the lives of a group of
persons carrying on the same occupation; or
(d) are of a class prescribed.
(3) A director, employee or agent for an insurer or of a broker shall not pay, allow or give
or offer to pay, directly or indirectly-
(a) a rebate of the premiums payable on an insurance policy;
(b) any consideration or thing of value intended as an inducement to effect insurance
cover;
(c) preferential treatment in connection with bonus or other benefit under a life policy; or
(d) any portion of the commission payable to the agent or broker in respect of that life
policy.
(4) The provisions of subsection (3) shall not apply to the grant to an employee or former
employee or spouse or dependant child of an insurer or broker of a rebate of commission on a
policy effected by him on his own life.
(5) No person shall knowingly receive as such any rebate of premium, advantage or
preferential treatment referred to in subsection (3) as an inducement to insure.
(6) No director, employee or agent of an insurer or of a broker shall accept any proposal
or application for a life policy in respect of which-
(a) a promissory note, bill of exchange or other negotiable instrument, not being a cheque
payable on the date of issue; or
(b) an acknowledgement of debt, not being a stop order or direct debit,
in favour of the insurer or any person whomsoever has been given for the first year's premium
or any part thereof.
(7) Any person who contravenes any provision of this section shall be guilty of an
offence and liable on conviction thereof to a fine not exceeding 10 times the amount of the
annual premium normally payable on an insurance policy similar to the one in respect of which
the offence was committed.
(8) A person who is not an insurer, broker, agent or the employee of such insurer, broker
or agent shall not, directly or indirectly, pay or allow, agree to pay or allow, or attempt to pay or

allow, compensation or anything of any value to any person for-
(a) placing or negotiating insurance on any life, property or interest in Botswana; or
(b) negotiating the continuance or renewal of insurance on any life, property or interest in
Botswana.
97. Non-forfeiture of life policies in certain cases of non-payment of premiums
(1) A life policy, other than those defined in subsection (5) , shall not be forfeited by
reason only of the non-payment of any premium (in this section referred to as "the overdue
premium") if-
(a) not less than three years' premiums have been paid in cash on the policy; and
(b) the surrender value of the policy (calculated as at the day immediately preceding that
on which the overdue premium falls due) exceeds the sum of the amount of the debts
owing to the insurer under, or secured by, the policy, and the amount of the overdue
premium.
(2) The insurer may, until payment of the overdue premium, charge compound interest
on it on terms not less favourable to the policyholder than such terms as are set out in the tables
furnished to the Registrar under section 65.
(3) The overdue premium and any interest charged on it under this section and unpaid
shall, for the purposes of this Act, be deemed to be a debt owing to the insurer under the policy.
(4) Without affecting the generality of subsection (1), a life policy on which less than
three years' premiums have been paid in cash shall not be forfeited by reason only of the
non-payment of a premium unless, on or after the day on which the premium fell due, the
insurer liable under the policy serves a notice on the policyholder stating-
(a) the amount due or payable to the insurer at the date of the notice in respect of the
policy; and
(b) that the policy will be forfeited at the expiration of one month after service of the notice
if a sufficient sum is not paid to the insurer in the meantime.
(5) Where a premium is overdue in respect of life policies where premiums are payable
at intervals not exceeding two months in each case, to collectors sent by the insurer to each
policyowner, or to his residence or place of work-
(a) a policy on which less than one year's premiums have been paid in cash shall not be
forfeited by reason only of the non-payment of any premium unless the premium has
remained unpaid for not less than one month after it became due;
(b) a policy on which not less than one year's premiums have been paid in cash shall not
be forfeited by reason only of the non-payment of any premium unless the premium
has remained unpaid for not less than two months after it became due;
(c) a policy on which not less than two years' premiums have been paid in cash shall not
be forfeited by reason only of the non-payment of any premium unless the premium
has remained unpaid for not less than three months after it became due; and
(d) in the event of a policy on which not less than three years' premiums have been paid in
cash being forfeited by reason of non-payment of any premium, the insurer shall,
without requiring any application from the policyholder, grant a paid-up policy for an
amount not less than that calculated in accordance with tables approved under section
65; such paid-up policy shall be payable upon the happening of the contingency upon
which the amount insured under the original policy would have been payable.
(6) Nothing in this section shall preclude an insurer from granting to an owner of a policy
of a kind referred to in this section more favourable terms than those specified.
98. Paid-up policies
(1) A policyholder who desires to discontinue further premium payments on a life policy
on which not less than three years' premiums have been paid in cash shall, on application to the
insurer, be entitled to receive, in lieu of that policy, a paid-up policy for an amount not less than
that determined in accordance with the tables approved under section 65.

(2) The paid-up policy shall be payable upon the happening of the contingency upon the
happening of which the amount assured under the original policy would have been payable.
99. Surrender of policies
(1) The owner of a life policy which has been in force for at least three years shall, on
application to the insurer, be entitled to surrender the policy and to receive not less than the
surrender value of the policy less the amount of any debt owing to the insurer under, or secured
by, the policy.
(2) In the application of subsection (1) to a paid-up policy which has been issued in lieu
of another policy, the period of three years shall be calculated from the date of issue of the
original policy.
(3) For the purposes of this section the surrender value of a policy shall be the amount
calculated in accordance with the tables furnished to the Registrar under section 65.
(4) The Registrar may, on application by an insurer, if, in his opinion, the payment in
cash of surrender values as required by this section would be prejudicial to the financial stability
of the insurer or to the interests of the policyholders of that insurer, suspend or vary for such
period and subject to such conditions as the Registrar thinks fit, the obligation of the insurer to
pay those surrender values.
100. Cancellation of life policy within limited period without penalty
(1) A life policy issued after the commencement of this Act may be cancelled by the
policyholder within a period of three months from the date on which the proposal form was
signed, or within one month of the receipt of the policy by the owner, whichever is the later by
returning the policy to the insurer with an objection in writing to any term or condition of the
policy or a statement that he does not require the policy, and the insurer shall forthwith refund
any premium which has been paid in respect of the policy which shall thereupon be cancelled.
(2) For the purposes of this section, where a policy is sent by registered post by an
insurer to the person to whom it is issued, it shall, unless the contrary is proved, be deemed to
have been delivered to him at the time at which it would reach him in the ordinary course of the
post.
(3) For the purposes of this section, a policy shall be deemed to have been returned with
an objection or statement, as the case may be, if the policy and objection or statement are
posted for transmission to the insurer by registered post.
(4) The insurer shall when delivering the policy to the policyholder include therewith a
synopsis of the right of the policyholder under subsection (1) hereof to cancel the policy.
101. Publication of bonus rates and unit values
(1) For the purposes of this section, in the case of an insurer transacting long term
business where-
(a) there is either-
(i) an established surplus in which long term policyholders of any category are eligible
to participate; or
(ii) an adjusted unit value in which long term policyholders of that category benefit;
and
(b) an amount has been allocated to policyholders of that category in respect of a
previously established surplus or adjusted unit value in which policyholders of that
category were eligible to participate,
such an allocation made shall-
(i) during the currency of the policy, be known for the purposes of this section as "the
reversionary bonus"; or
(ii) in addition to any reversionary bonuses attaching to the policy, but only upon the death
of the policyholder or upon the happening of some other future event resulting in the
payment of benefit under the policy, be known for the purposes of this section as "the
terminal bonus".

(2) An insurer transacting long term business who allocates reversionary bonuses to
policyholders by the application of a factor applied to the policy sum insured shall advise the
Registrar in writing and publish in the Gazette and in at least one national Botswana publication-
(a) within one month from the coming into force of this Act; or
(b) upon any alteration of the factor thereafter within one month of the date of the approval
by the insurer's board of directors with the approval of the actuary,
the amount and effective date of that factor, and on what basis including what continuing basis
policyholders eligible to participate are benefited by it.
(3) An insurer transacting long term business who allocated reversionary bonuses to
policyholders by amending the value of any holding of units, or other beneficial interest, under
an investment unit policy shall advise the Registrar in writing and publish in the Gazette and in
at least one national Botswana publication-
(a) within one month from the coming into force of this Act; or
(b) upon any amendment of the value of the unit thereafter, within two weeks of the date of
such amendment or at least monthly whichever is the more frequent,
the value of each unit and the effective date of each revaluation of the fund from which the unit
value is calculated, and on what basis including what continuing basis policyholders eligible to
participate are benefited by it.
(4) In the event that the policyholders of a single insurer holding different classes or
types of policy derive different benefit levels in any bonus distribution issued to them under the
terms of this section, the provisions of this section shall apply to each separate type of bonus so
distributed.
(5) For the purposes of and in consequence of subsection (3), units may only be
allocated to a life policy at the price published immediately prior to a policy being effected and
any subsequent unit purchase shall be based upon the last published unit price at the date of
purchase for the relevant type of policy.
102. Advertisements and projected benefits
(1) Where an insurer transacting long term business issues policies of a class or classes
of which an established surplus, or adjusted unit value, not being a guaranteed sum, is
distributable in whole or in part to policyholders then any advertisements issued by the insurer,
its employees and agents and any projections on benefits which may accrue to potential
policyholders in general or a potential policyholder in particular shall be governed by the
provisions of this section.
(2) The provisions of subsection (1) of section 101 shall apply to this section.
policyholders by the application of a factor applied to the policy sum insured shall, when making
any advertisement or projection of benefits use only the last published factor and application of
reversionary bonus as required under the terms of subsection (2) of section 101.
policyholders by amending the value of any holding of units, or other beneficial interest, under
an investment unit policy shall when making any advertisement or projection-
(a) of benefits, use only the annual average compounded interest growth rate over the
effective four year period of the said unit produced from the mean valuations of-
(i) the unit value effective as at the first day of the month in which the advertisement
or projection is made and of the 11 preceding monthly unit values; and
(ii) the unit value effective as at the first day of the month, 60 months previous to the
month in which the advertisement or projection is made and of the 11 subsequent
monthly unit values;
(b) use only those unit values for the purposes of paragraph (a) which shall be published
in accordance with subsection (3) of section 101; and
(c) include in the advertisement or projection if applicable the basis or formula required to

be approved by the Registrar under the provisions of subsection (3) of section 65.
(5) When making an advertisement or projection under this section, an insurer shall-
(a) not include in the financial projection any reference to any terminal bonus or other
distribution except that mention may be made to the existence of such a possible
provision; and
(b) prominently make mention in all advertisements and projections that such projections
are not guaranteed and may vary both upwards and downwards from that stated in the
advertisement or projection.
PART IX
Miscellaneous Provisions (ss 103-132)
103. Fatal accidents
Notwithstanding the provisions of any other enactment, in assessing damages in any
action, whether commenced before or after the passing of this Act, there shall not be taken into
account any sum paid or payable on the death of the deceased under any contract of insurance
whether effected before or after the passing of this Act-
(a) effected voluntarily by the deceased person; and
(b) in respect of which the premiums paid were paid by or for the deceased from his
personal resources.
vii
104. Insurances to be held with Botswana insurers *
(1) The Minister may by regulations direct that any or all insurances effected by
Botswana residents or Botswana resident companies of such class or classes as he shall direct,
shall be placed with Botswana insurers.
(2) Where a class of insurance required to be placed with a Botswana insurer under
subsection (1) is not available to a person seeking insurance, such person may place such
insurance with a non-resident insurer provided that-
(a) he obtains the prior approval of the Registrar; and
(b) he complies with the provisions of section 105.
(3) Nothing in this section shall affect the requirements of any exchange control law for
the time being in force in Botswana.
viii
105. Compulsory local brokerage *
Any general insurance business policy effected by a Botswana resident or Botswana
resident company other than an insurer licensed under this Act with any non-resident insurer
shall be effected through the offices of a Botswana licensed broker.
ix
106. Unlimited indemnities prohibited *
An insurer shall not, on or after a date to be specified by the Minister by regulations,
issue or renew a policy of insurance under which the insurer undertakes a liability the amount or
maximum amount of which is uncertain at the time when the contract of insurance is entered
into or renewed.
107. Commissions only to brokers and agents
No company or individual not a party to any contract of insurance, except an agent or
broker licensed under this Act or an employee of an insurer, shall be paid any commission or
consideration or thing of value by any Botswana insurer, agent or broker for the effecting or
renewing of any policy of insurance subject to the provisions of subsection (3) and subsection
(5) of section 96.
108. Time limit on payment of premiums
(1) The Registrar may by notice published in the Gazette and by written notice to each
insurer require insurance premiums due to Botswana insurers from Botswana residents, other
than another Botswana insurer, to be paid within a specified time from the date the insurance
was effected or renewed.
(2) The Registrar may, in any notice issued under subsection (1), specify different times

for payment of premiums due from brokers, agents and on insurance business placed directly
with the insurer or through the offices of an agent or broker.
109. Days of grace
(1) No insurer shall extend insurance cover in respect of any policy of insurance effected
in the course of its general business beyond a period of 30 days (to be known as the "days of
grace"), commencing with the day following the last day of the previous insurance period unless
specific instructions have been received prior to or during the days of grace to renew such
insurance, and where such instructions are not received the policy cover shall be treated as
having lapsed on the last day of the previous insurance period.
(2) Any notice that an insurer shall issue inviting the renewal of any policy shall include a
statement indicating the time period during which insurance cover will remain operative prior to
receipt of instructions to renew such policy.
110. Exemption
The Minister may, by statutory instrument, in the public interest, make an order
exempting any insurer, broker or agent from all or any of the provisions of this Act subject to
such terms and conditions as he may think fit.
111. Extension of time
(1) Where an insurer, broker or agent or an applicant for a licence under this Act is
required or entitled to do or refrain from doing anything within a specified period of time, the
Registrar may at his discretion, on an application in writing by such insurer, broker or agent or
applicant, extend such time for a period of not more than three months.
(2) The provisions of this section shall apply notwithstanding that the specified period of
time may have expired.
112. ...... 113.Inspection of balance sheet by policyholder, etc.
(1) A policyholder may inspect and shall be entitled to receive one copy of the summary
of the latest audited balance sheet of any insurer with whom his policy has been effected.
(2) An insurer shall be entitled to receive a copy of the latest audited accounts of any
broker who has an agency agreement with that insurer:
Provided that an insurer shall not divulge any information so received to any person or
body of persons and shall take all such action as may be necessary to ensure the confidentiality
of the said information.
(3) A person entitled to receive a balance sheet or audited accounts shall be entitled to
receive such document without payment of any fee therefor upon application during normal
business hours at the principal office of the insurer or broker, as the case may be.
114. Restriction on use of words "insurance" and "assurance"
Any person other than a licensed insurer, broker or agent who uses the words
"insurance" or "assurance" or any combination or derivative thereof as part of the business
name, style or title of that person shall be guilty of an offence.
115. No advertisement before licensing
(1) No person or body of persons or body corporate shall advertise services requiring a
licence under this Act until such licence has been issued to such person, body of persons or
body corporate.
(2) Any person, body of persons or body corporate acting in contravention of this section
shall be liable to a fine not exceeding P2,000 or to imprisonment for a term not exceeding three
months, or to both.
116. Service of process
(1) Service of process in any legal proceedings against an insurer licensed under this
Act may be effected at the principal office of the insurer in Botswana.
(2) If an insurer has no principal office in Botswana or it has ceased to exist, process in
any legal proceedings against the insurer may be served at the office of the Registrar, and
service upon the Registrar, in such case, shall be deemed to be service upon the insurer.

117. Enforcement of rights of policyholders
(1) The holder of a policy issued by a Botswana insurer shall, notwithstanding any
contrary provision in the policy or in any agreement relating to the policy, be entitled to enforce
his rights under the policy against the insurer liable under the policy in any court in Botswana.
(2) Notwithstanding the provisions of subsection (1) a policy issued by a Botswana
insurer may provide that the amount of any liability under a policy shall be determined in
accordance with the provisions of the Arbitration Act.
118. - 121 ...... 122. Inspection of returns to the Registrar
(1) The Registrar may permit any person on payment of the prescribed fee to inspect,
make copies or obtain certified copies of any document submitted to him under sections 31 and
63.
(2) No fee shall be paid to the Registrar for information supplied by him to the principal
officer in Botswana of a licensed insurer or broker.
123. ...... 124.Continuation of business of insurer in liquidation
(1) The liquidator shall, so far as it may be possible and unless the court otherwise
orders, carry on the insurance business of an insurer with a view to being transferred as a going
concern to another insurer, whether an existing company or a company formed for the purpose;
and, in carrying on that business, the liquidator may agree to the variation of any contracts of
insurance in existence when the winding-up order is made but shall not effect any new contracts
of insurance.
(2) If the liquidator is satisfied that the interests of the creditors in respect of liabilities of
the insurer attributable to its business require the appointment of a special manager of the
business, he may apply to the court, and the court may on the application appoint a special
manager of that business to act during such time as the court may direct, with such powers,
including any of the powers of a receiver or manager, as may be entrusted to him by the court.
(3) The court may require the special manager to give such security as it considers
necessary.
(4) The court may make such order as it considers appropriate with regard to the
payment of remuneration to the special manager.
(5) The court may, subject to such conditions as it may determine, reduce the amount of
the contracts made by an insurer in the course of carrying on his business as an alternative to
winding-up or otherwise.
125. Secondary companies
(1) For the purposes of and in consequence of section 123, where the insurance
business or any part of the insurance business of an insurer has been transferred to an insurer
to which this Act applies under an arrangement in pursuance of which the first-mentioned
insurer (in this section called the "secondary company") or the creditors thereof has or have
claims against the insurer to which the transfer was made (in this section called the "principal
company") then, if the principal company is being wound up by or under the supervision of the
court, the court shall, subject to the provisions of this section, order the secondary company to
be wound up in conjunction with the principal company and may by the same or any subsequent
order appoint the same person to be liquidator for the two insurers and make provision for such
other matters as may seem to the court necessary, with a view to the insurers being wound up
as if they were one insurer.
(2) The commencement of the winding-up of the principal company shall, except as
otherwise ordered by the court, be the commencement of the winding up of the secondary
company.
(3) In adjusting the rights and liabilities of the members of the several insurers between
themselves, the court shall have regard to the constitution of the insurers, and to the
arrangements entered into between the insurers in the same manner as the court has regard to
the rights and liabilities of different classes of contributors in the case of the winding-up of a

single insurer or as near thereto as circumstances admit.
(4) Where an insurer alleged to be secondary is not in the process of being wound up at
the same time as the principal company to which the insurer is secondary, the court shall not
direct the secondary company to be wound up unless, after hearing any objections that may be
urged by or on behalf of the insurer against being wound up, the court is of the opinion that the
insurer is secondary to the principal company and that the winding-up of the insurer in
conjunction with the principal company is just and equitable.
(5) An application may be made in relation to the winding-up of a secondary company in
conjunction with a principal company by any creditor of, or person interested in, the principal or
secondary company.
(6) Where an insurer stands in the relation of a principal company to one insurer, and in
the relation of a secondary company to another insurer, or where there are several insurers
standing in the relation of secondary companies to one principal company, the court may deal
with any number of such companies together or in separate groups, as it thinks most expedient,
upon the principles laid down in this section.
126. False documents
(1) No person shall, in any statement, return, report, certificate, balance sheet or other
document required by or for the purposes of this Act, wilfully make a statement which is false in
any material particular knowing such statement to be false or not believing it to be true.
(2) No person shall, with intent to defraud or deceive-
(a) destroy, mutilate, alter or falsify any books, papers or securities or other record
maintained for or by any electronic retrieval system belonging to any insurer, broker or
agent; or
(b) make or be a party to the making of any false or fraudulent entry in any register, book
of account or other document or other record maintained for or by any electronic
retrieval system belonging to any insurer, broker or agent.
(3) Any person who contravenes the provisions of this section shall be guilty of an
offence and shall be liable to a fine not exceeding P36,000 or to imprisonment for a term not
exceeding two years or to both.
127. Fees
The Registrar may charge such fees in connection with the licensing of insurers, brokers
and agents and any other exercise of his functions and the administration of the office of the
Registrar under this Act as may be prescribed.
128. Contraventions punishable by regulatory authority (1) The directors, manager,
controller and principal officer of an insurer or a broker acting in contravention of the provisions
of section 8, 17 or 25 shall each be liable to a civil penalty not exceeding P10,000 to be
imposed by the Regulatory Authority.
(2) Any person carrying on any insurance business without first being licensed as an
insurer shall be liable to a civil penalty not exceeding P10,000 to be imposed by the Regulatory
Authority, and, where the person contravening this section is a company or partnership, every
director, manager, controller and principal officer of the company or every partner, manager,
controller or principal officer of the partnership shall each be personally liable as if he was
personally responsible for the contravention.
(3) Any person carrying on the business of an insurance agent, broker or agent for a
broker without first being licensed as an insurance agent, broker or agent for a broker, as the
case may be, shall be liable to a civil penalty not exceeding P3,600 to be imposed by the
Regulatory Authority, and, where the person contravening this subsection is a company or a
partnership, every director, manager, controller or principal officer of the company or every
partner, manager or principal officer of the partnership shall each be personally liable as if he
was personally responsible for the contravention.
(4) An insurance agent or agent for a broker acting in contravention of the provisions of

section 47 shall, in addition to any offence for which he may be liable under any other law be
liable to a civil penalty not exceeding P3,600 to be imposed by the Regulatory Authority.
(5) Any insurer or broker who knowingly employs any person deemed unsuitable by
virtue of sections 17 and 51 respectively shall be liable to a civil penalty not exceeding P18,000
to be imposed by the Regulatory Authority.
(6) For the purposes of subsection (5), where the facts which render a particular person
unsuitable under those sections are either sufficiently notorious or facts that could have been
ascertained very readily, the Registrar may presume that the insurer or broker employed that
person knowingly.
(7) The Registrar may treat the non-payment of any civil penalty imposed by him as
sufficient reason for cancellation of the licence of any licensed insurer, broker, insurance agent
or agent for a broker.
(8) Notwithstanding any other action taken by the Registrar under this Act, any civil
penalty imposed by him under the provisions of this section shall be recoverable as a civil
penalty imposed by a court under the provisions of subsections (1) to (4) of section 303 of the
Criminal Procedure and Evidence Act, and an affidavit sworn by the Registrar shall be sufficient
proof of the lawful imposition of the civil penalty to enable the court to issue a warrant under
those provisions:
Provided that no warrant shall be issued until any appeal under section 118 has been
heard and disposed of or until the time within which an appeal may be made thereunder has
expired.
129. Offences punishable by court
(1) Every insurer which-
(a) fails to comply with the provisions of section 27 or 31; or
(b) acts in contravention of the provisions of section 11 or 72,
and every broker who fails to comply with the provisions of section 58 or 63 shall be guilty of an
offence.
(2) Every insurer guilty of an offence under this section or under the provisions of section
9, 10 or 71 shall be liable to a fine not exceeding P90,000 and every director, manager,
controller and principal officer of any such insurer shall each be personally liable to a fine not
exceeding P36,000 or to imprisonment for a term not exceeding two years or to both, unless
such director, manager, controller or principal officer can prove to the satisfaction of the court
that he was unaware of the default and had taken all reasonable steps to keep himself informed
of any possibility of such default.
(3) No prosecution shall be commenced under this section by any person other than the
Registrar or by a person authorised in writing by the Registrar.
130. General penalty (1) Every person who acts in contravention of any of the
provisions of this Act shall, where no punishment has been stipulated by any other section of
this Act for that contravention, be liable to a civil penalty not exceeding P3,600 to be imposed by
the Regulatory Authority.
(2) Where an contravention to which this section applies is committed by a body of
persons, every director, manager, controller and principal officer of the company and every
partner, manager or principal officer of the partnership shall held personally responsible for the
contravention:
Provided that if the individual concerned can prove to the satisfaction of the
Regulatory Authority that he was not aware of the act or default which contravened the
provisions of this Act and could not with reasonable diligence have become aware of it, he shall
not be deemed liable under this section.
(3) The provisions of subsection (8) of section 128 shall apply to any civil penalty
imposed under this section.
131. Regulations

(1) The Minister may, by statutory instrument, make regulations-
(a) prescribing any matter or thing referred to in this Act as prescribed or to be prescribed;
(b) in relation to any other matter or thing authorised or required by this Act to be made or
done by or in accordance with regulations; and
(c) generally for the purpose of giving effect to this Act.
(2) Regulations made under this section may make different provisions for different
classes of insurers, brokers or agents and insurance business.
132. Application of Act
(1) This Act applies to every insurer, broker or agent and every class of insurance
business other than an insurer, broker or agent or class of insurance business which is
exempted from its provisions by a statutory instrument made by the Minister under section 110.
(2) Where an insurer, broker or agent or class of insurance business is exempted by
such an instrument from some but not all of the provisions of this Act, the provisions other than
the provisions in respect of which the exemption is made shall apply to such insurer, broker or
agent or such class of insurance business, as the case may be.
FIRST SCHEDULE
CLASSES OF LONG TERM BUSINESS
Number Description Nature of Business
I Life and annuity Effecting and carrying out contracts of insurance on
human life or contracts to pay annuities on human life,
but excluding (in each case) contracts within Class III
below.
II Marriage and birth Effecting and carrying out contracts of insurance to
provide a sum on marriage or on the birth of a child,
being contracts expressed to be in effect for a period of
more than one year.
III Linked long term Effecting and carrying out contracts of insurance on
human life or contracts to pay annuities on human life
where the benefits are wholly or partly to be determined
by reference to the value of, or the income from, property
of any description (whether or not specified in the
contracts) or by reference to fluctuations in, or in an index
of, the value of property and any description (whether or
not so specified).
IV Permanent health Effecting and carrying out contracts of insurance
providing specified benefits against risks of persons
becoming incapacitated in consequence of sustaining
injury as a result of an accident or of an accident of a
specified class or of sickness or infirmity, being contracts
that-
(a) are expressed to be in effect for a period of not less
than five years, or until the normal retirement age for the
persons concerned, or without limit of time; and
(b) either are not expressed to be terminable by the
insurer, or are expressed to be so terminable only in
special circumstances mentioned in the contract.
V Tontines Effecting and carrying out tontines.
VI Capital redemption Effecting and carrying out contracts of-
(a) capital redemption; or
(b) pure endowment and deferred annuity as defined in
the Pensions and Provident Funds Act.
VII Deposit Effecting and carrying out-
Administration schemes (a) contracts to maintain and manage deposit
administration policies; or

(b) contracts of the kind mentioned in paragraph (a), that
are combined with contracts of insurance covering either
conservation of capital or payment of a minimum interest.
SECOND SCHEDULE
CLASSES OF GENERAL BUSINESS
Number Description Nature of Business
1 Accident Effecting and carrying out contracts of insurance and
providing fixed pecuniary benefits or benefits in the
nature of indemnity (or a combination of both) against
risks of the person insured-
(a) sustaining injury as the result of an accident or of an
accident of a specified class;
(b) dying as the result of an accident or of an accident of
a specified class; or
(c) becoming incapacitated in consequence of disease or
of disease of a specified class,
inclusive of contracts relating to industrial injury and
occupational disease but exclusive of contracts falling
within Class 2 below or within Class IV in the First
Schedule to this Act (permanent health).
2 Sickness Effecting and carrying out contracts of insurance
providing fixed pecuniary benefits or benefits in the
nature of indemnity (or a combination of the two) against
risks of loss to the persons insured attributable to
sickness or infirmity, but exclusive of contracts falling
within Class IV in the First Schedule to this Act.
3 Land vehicles Effecting and carrying out contracts of insurance against
loss of or damage to vehicles used on land, including
motor vehicles, but excluding railway rolling stock.
4 Railway rolling stock Effecting and carrying out contracts of insurance against
loss of or damage to railway rolling stock.
5 Aircraft Effecting and carrying out contracts of insurance upon
aircraft or upon the machinery, tackle, furniture or
equipment of aircraft.
6 Ships Effecting and carrying out contracts of insurance upon
vessels used on the sea or inland water, or upon the
machinery, tackle, furniture or equipment of such
vessels.
7 Goods in transit Effecting and carrying out contracts of insurance against
loss or damage to merchandise, baggage and all other
goods in transit, irrespective of the form of transport.
8 Fire and natural forces Effecting and carrying out contracts of insurance against
loss of or damage to property (other than property to
which Classes 3 to 7 above relate) due to fire, explosion,
storm, natural forces other than storm, nuclear energy or
land subsidence.
9 Damage to property Effecting and carrying out contracts of insurance against
loss of or damage to property (other than property to
which Classes 3 to 7 above relate) due to hail or frost or
to any event (such as theft) other than those mentioned
in Class 8 above.
10 Motor vehicle liability Effecting and carrying out contracts of insurance against
damage arising out of or in connection with use of motor
vehicles on land, including third party risks and carrier's

liability.
11 Aircraft liability Effecting and carrying out contracts of insurance against
damage arising out of or in connection with the use of
aircraft, including third party risks and carrier's liability.
12 Liability for ships Effecting and carrying out contracts of insurance against
damage arising out of or in connection with the use of
vessels on the sea or on inland water, including third
party risks and carrier's liability.
13 General liability Effecting and carrying out contracts of insurance against
risks of the persons insured incurring liabilities to third
parties, the risks in question not being risks to which
Class 10, 11 or 12 above relates.
14 Credit Effecting and carrying out contracts of insurance against
risks of loss to the persons insured arising from the
insolvency of debtors of theirs or from the failure
(otherwise than through insolvency) of debtors of theirs to
pay their debts when due.
15 Suretyship Effecting and carrying out-
(a) contracts of insurance against risks of loss to the
persons insured arising from their having to perform
contracts of guarantee entered into by them;
(b) contracts for fidelity bonds, performance bonds,
administration bonds, bail bonds or custom bonds or
similar contracts of guarantee.
16 Miscellaneous financial Effecting and carrying out contracts of insurance against
loss any of the following risks, namely-
(a) risks of loss to the persons insured attributable to
interruptions of the carrying on of business carried on by
them or to reduction of the scope of business so carried
on;
(b) risks of loss to the persons insured attributable to their
incurring unforeseen expense;
(c) risks neither falling within paragraph (a) or (b) above
nor being of a kind such that the carrying on of the
business of effecting and carrying out contracts of
insurance against them constitutes the carrying on of
insurance business of some other class.
17 Legal expenses Effecting and carrying out of contracts of insurance
against risks of loss to the persons insured attributable to
their incurring legal expenses (including costs of
litigation).
i
Date of commencement of section 47: 1st July, 1991.
ii
iii
iv
Date of commencement of subsection (2): 1st July, 1991.
v
vi
vii
Date of commencement of section 104: 22nd January, 2008.
viii
ix
Date of commencement of section 106: 22nd January, 2008.

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CHAPTER 46:01

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First Schedule - Classes of Long Term Business

Act 21, 1987,

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