APRA finalises changes to life prudential framework

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8 March 2010

The prudential regulator has finalised changes that allow it to supervise groups containing life insurers in the same way as it oversees general insurers.

The final prudential standards follow new legislation introduced last year that allows the Australian Prudential Regulation Authority (APRA) to regulate non-operating holding companies of life insurance companies.

APRA intends to apply the same governance standards that currently apply to non-operating holding companies of general insurers and authorised deposit-taking institutions.

APRA Executive Member John Trowbridge says the enhancements to the prudential framework provide important protection to policyholders.

“The revised prudential standards aim to ensure registered non-operating holding companies of life companies have sound governance procedures which include that [people] in responsible positions are fit and proper,” he said.

The revised prudential standards take effect from July 1.