- The Financial Sector Conduct Authority (FSCA) has taken decisive action against four funeral businesses for running unlicensed insurance operations.
- Together, these firms collected more than R67 million in premiums and issued thousands of funeral policies without the required insurance licences.
- Their directors have now admitted to the breaches and agreed to specific corrective actions under the Financial Sector Regulation Act.
A recent FSCA investigation has exposed illegal insurance practices by four South African funeral service providers.
Funeral Assist 24 CC, based in Johannesburg and headed by Samuel Levy Matsimbi, advised around 2 000 clients between October 2022 and June 2025. During this period, the company collected R666 708 in premiums and paid out 144 claims worth a total of R432 000.
Matsimbi admitted to knowingly issuing funeral policies without a licensed underwriter and fully cooperated with the FSCA. As part of the enforceable undertaking, he is required to provide proof of compliance underwriting, register as a representative, and ensure future adherence to regulatory requirements.
In Cape Town, Eyodidi Funeral Undertaker, under the direction of Zandisile Christopher Stali, operated from December 2023 to June 2025. The business collected R810 000 in premiums from 150 clients and settled 98 claims. The FSCA’s investigation revealed that Stali had rendered financial services without being licensed or appointed as a representative of a licensed provider. Stali admitted to these contraventions and has signed an undertaking to rectify the firm’s licensing status and ensure future compliance.
Meanwhile, in Ermelo, Mpumalanga, Nkosinathi Frederick Mkhwanazi managed a transition between Soul City No 1 Funeral Parlour CC and Amashiba Amahle Funeral Parlour (Pty) Ltd in February 2025. Across both entities, 220 clients were advised, R13 000 in premiums were collected, and 50 claims were paid. Mkhwanazi acknowledged the breaches and has committed to immediate compliance, including providing proof of underwriting arrangements and registering as a representative.
The most significant case was uncovered in Orkney, North West, where TFBS Funeral Parlour CC, led by Bongani Sydwell Mafuleni, advised a staggering 275 870 clients and collected R66 263,210 in premiums between May 2022 and September 2024. The company paid out 2 325 claims totalling R34 875 000. Mafuleni admitted full knowledge and responsibility for the unlicensed insurance activities and signed an enforceable undertaking to bring TFBS in line with regulatory requirements.
These businesses were found to have issued funeral policies without licensed underwriters, violating the Insurance Act and the Financial Advisory and Intermediary Services (FAIS) Act. The fallout meant that hundreds of thousands of clients were left exposed to regulatory risk, and millions of rand in premiums were collected illegally.
After the investigation, each company’s directors signed enforceable undertakings under section 151(1) of the Financial Sector Regulation Act. These agreements require them to regularise their insurance arrangements and ensure all representatives are registered with licensed financial service providers.
What comes next: Compliance deadlines and sector impact
All four directors must now provide proof of proper underwriting within 30 working days, register their representatives with licensed financial service providers, and guarantee that all future policies are properly underwritten. Failure to comply will result in penalties, debarment, or a hearing before the Financial Services Tribunal.
This crackdown signals a major shift in how the FSCA regulates the funeral sector. By prioritising consumer protection and requiring swift corrective action, the regulator aims to restore trust without disrupting essential services. For clients, these undertakings provide a path to future security and regulatory protection. For funeral operators, the message is clear: unlicensed insurance will not be tolerated.
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