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The Purpose of FAIS
FAIS exists to protect consumers when they buy financial products and to professionalise the people who sell and advise on them. Its core aim is simple: that anyone giving you financial advice is licensed, competent and acting in your interests, and that you are told what you are buying and what it costs.
Before FAIS, advice on insurance and investments was lightly regulated and inconsistent. The Act created a single framework of licensing, conduct standards and recourse, overseen today by the Financial Sector Conduct Authority, so that poor or self-interested advice has consequences.
What Counts as Advice Under FAIS
Under the Act, 'advice' is any recommendation, guidance or proposal of a financial nature made to you about a specific product — for example, being told that a particular policy suits your needs or that you should switch insurers. It is broader than most people expect and covers far more than a hard sell.
The distinction the Act draws is between advice and mere factual information. Quoting a premium or explaining how an excess works in general is information; steering you toward a specific product for your situation is advice, and the moment it becomes advice the FAIS duties attach to whoever gave it.
The Financial Products FAIS Covers
FAIS covers a wide range of products, including short-term insurance such as car, home and contents cover, long-term insurance like life and disability policies, investment products, retirement annuities, and collective investments. Car insurance sits squarely within the short-term insurance category it regulates.
Because the net is wide, the same protections apply whether you are buying a motor policy or a retirement product. The provider must be licensed for the specific category of product they advise on, which is why a broker's licence lists the product types they are authorised to handle.
What FAIS Requires of Providers
A Financial Services Provider, or FSP, must be licensed and competent, must give advice appropriate to your actual needs, must disclose all material information including costs and commissions, and must handle complaints fairly. These are legal obligations, not courtesies.
OneCompare (Pty) Ltd is an Authorised Financial Services Provider, FSP number 55551, and operates under exactly these duties. The FSP number is the visible sign that a provider is licensed and accountable under the Act.
Your Rights as a Consumer
FAIS gives you the right to receive advice only from a licensed FSP, to get clear written disclosure of all costs and commissions, to be told about a product's material features and exclusions, to a cooling-off period on a new policy, and to complain to the FAIS Ombud if you are treated unfairly.
These rights are most useful before you commit. Asking for the FSP number, the written disclosure and the reasons a product is being recommended turns the Act's protections from theory into a practical checklist you can run through at the point of sale.
The FAIS Ombud
The FAIS Ombud investigates complaints about the conduct of FSPs — chiefly poor, misleading or unsuitable advice. If you believe you were steered into the wrong product or not told something material, you can lodge a complaint at no cost, and the Ombud's determinations bind the FSP up to a statutory limit.
The Ombud is the recourse arm of the Act: the licensing and conduct rules set the standard, and the Ombud is where a breach of that standard is tested. Keeping the written disclosures and advice records you are entitled to is what makes such a complaint provable.
What FAIS-Compliant Means
A provider that is FAIS-compliant holds the right licence for the products it advises on, employs representatives who meet the competence requirements, gives and records proper advice, and discloses costs and conflicts as the Act demands. Compliance is an ongoing obligation, not a one-time tick.
For you, the practical signal of compliance is a verifiable FSP number and a provider willing to put its advice and disclosures in writing. A provider that cannot produce an FSP number, or will not document its advice, is the warning sign the Act was written to surface.