Maree v C Booysen t/a NVM Beleggings & Versekeringsadviseurs

The respondent, an insurance broker, advised the appellant to replace an existing long-term insurance policy with a new policy. A written agreement provided that if the broker’s commission was clawed back by the insurer due to the policyholder’s conduct, the policyholder would remain liable to pay that commission. The appellant cancelled the new policy within the statutory ‘cooling-off’ period under the Long-term Insurance Act 52 of 1998, resulting in no commission being payable by the insurer. The broker sued the appellant for the lost commission based on the agreement. The Magistrates’ Court dismissed the claim as contrary to statute, but the High Court upheld the broker’s appeal. The matter came before the Supreme Court of Appeal.

The appeal was upheld with costs. The High Court order was set aside. The Magistrate’s order was amended so that the broker’s claim and the insured’s counterclaim were both dismissed with costs, with a costs apportionment reflecting partial success on appeal.

The case affirms strong consumer protection in South African insurance law by confirming that intermediaries may not recover commission or compensation from insured persons when a policy is cancelled within the statutory cooling-off period. It clarifies the scope of section 49 of the Long-term Insurance Act and renders void contractual attempts to обход statutory commission limits.