APRA is consulting on a package on the governance, fit and proper, audit, and disclosure requirements for private health insurers. The consultation provides measures designed to improve governance and decision-making in the private health insurance sector. Comments are invited by May 02, 2018. APRA is aiming to finalize the standards later this year, with the new measures expected to come into force from July 01, 2019.
The package commences phase two of APRA’s roadmap for comprehensively reviewing the prudential framework for private health insurance, which was launched in August 2016. Phase one focused on risk and has resulted in the adoption, from April 01, 2018, of cross-industry Prudential Standard CPS 220 Risk Management (CPS 220). Other aspects of phase one, including operational risk and the role of the actuary, remain ongoing. The third phase of the private health insurance roadmap, which will examine the capital standards in the industry, is likely to commence later this year. APRA is seeking consultation to:
- Replace Prudential Standard HPS 510 Governance (HPS 510) with the more forceful cross-industry equivalent standard CPS 510, to strengthen governance practices
- Extend cross-industry Prudential Standard CPS 520 Fit and Proper (CPS 520) to the industry to ensure the competency and integrity of anyone exercising material influence over a private health insurer
- Introduce Prudential Standard HPS 310 Audit and Related Matters (HPS 310) in recognition of the important role auditors can play in supporting prudential soundness
- Revoke Prudential Standard HPS 350 Disclosure to APRA (HPS 350) to streamline reporting and remove obsolete requirements
Comment Due Date: May 02, 2018
Effective Date: July 01, 2019
Keywords: Asia Pacific, Australia, Insurance, Private Health Insurers, CPS 220, HPS 510, HPS 310, HPS 350, CPS 520, APRA
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