Featured Product

    APRA Amends Prudential Standards in Line with CPS 320 and GPS 340

    March 19, 2019

    APRA issued a letter to all general insurers, life insurers, and private health insurers proposing minor changes to the prudential framework to implement the cross-industry appointed actuary standard. APRA is making amendments to thirteen prudential standards to reflect consequential changes arising from the introduction of the new Prudential Standard CPS 320 Actuarial and Related Matters (CPS 320) and Prudential Standard GPS 340 Insurance Liability Valuation (GPS 340). APRA intends to finalize the revised standards in April 2019. The standards will commence on July 01, 2019.

    The changes primarily replace references to revoked standards, update references from Insurance Liability Valuation Report (ILVR) to Actuarial Valuation Report (AVR), streamline clauses regarding exercises of discretion by APRA under previous prudential standards, delete outdated transitional provisions, and correct typographical errors. The following prudential standards are being amended:

    • CPS 220 on Risk Management
    • CPS 510 on Governance
    • GPS 110 on Capital Adequacy
    • GPS 112 on Capital Adequacy Measurement of Capital
    • GPS 113 on Capital Adequacy Internal Model-based Method
    • GPS 114 on Capital Adequacy Asset Risk Charge
    • GPS 115 on Capital Adequacy Insurance Risk Charge
    • GPS 116 on Capital Adequacy Insurance Concentration Risk Charge
    • GPS 118 on Capital Adequacy Operational Risk Charge
    • GPS 120 on Assets in Australia
    • GPS 310 on Audit and Related Matters
    • HPS 310 on Audit and Related Matters
    • LPS 700 on Friendly Society Benefit Funds

    For general insurers, three minor changes to GPS 116 will also be made to reflect the current definitions and expectations of APRA. The revised GPS 116:

    • Removes reinsurance premium protection and capital market structures from the definition of alternative capital and risk mitigants in paragraphs 54 and Attachment B, paragraph 13, as these types of arrangements are more aligned with traditional reinsurance
    • Clarifies expectation that the Appointed Actuary include both details of the determination of the net premium liability provision which relates to catastrophic losses (the PL offset) for the reporting year and the estimated PL offset to be utilized in the upcoming year in the AVR
    • Continues the existing requirement that the Group Actuary provide the board of a Level 2 insurance group with an opinion on the Insurance Concentration Risk Charge whenever substantial changes are made or at least annually (at Attachment B, paragraph 18)

     

    Related Links

    Keywords: Asia Pacific, Australia, Insurance, Actuary, CPS 320, GPS 340, Risk Management, Capital Adequacy, Governance, APRA

    Featured Experts
    Related Articles
    News

    FSB Sets Out Effective Practices for Cyber Incident Recovery

    FSB finalized the toolkit of effective practices to assist financial institutions in their cyber incident response and recovery activities.

    October 19, 2020 WebPage Regulatory News
    News

    HKMA Urges Early Action for Adherence to IBOR Fallbacks Protocol

    HKMA urged authorized institutions to take early action to adhere to the IBOR Fallbacks Protocol, which ISDA is expected to publish soon.

    October 16, 2020 WebPage Regulatory News
    News

    FSB Sets Out Roadmap for Transition to Alternative Reference Rates

    FSB published a global transition roadmap for London Inter-bank Offered Rate (LIBOR).

    October 16, 2020 WebPage Regulatory News
    News

    HM Treasury Publishes Response to Proposal on BRRD2 Transposition

    HM Treasury published a document that summarizes the responses received from a consultation on the approach of UK to transposition of the revised Bank Resolution and Recovery Directive (BRRD2).

    October 15, 2020 WebPage Regulatory News
    News

    HM Treasury Publishes Response to Proposal on CRD5 Transposition

    HM Treasury published the government response to the feedback received on the consultation for updating the prudential regime of UK before the end of the Brexit transition period.

    October 15, 2020 WebPage Regulatory News
    News

    BoE Publishes Reporting Schedule for Statistical Returns

    In a recent statistical notice, BoE announced publication of the reporting schedule for statistical returns for 2021.

    October 15, 2020 WebPage Regulatory News
    News

    EC Welcomes Declaration by Member States on EU Cloud Federation

    EC welcomed the joint declaration by 25 EU member states on building the next generation of cloud in Europe.

    October 15, 2020 WebPage Regulatory News
    News

    MAS Amends Notice on Issuance of Covered Bonds by Banks in Singapore

    MAS published amendments to Notice 648 on the issuance of covered bonds by banks incorporated in Singapore.

    October 15, 2020 WebPage Regulatory News
    News

    FDIC Selects Technology Companies for Rapid Prototyping Competition

    FDIC has selected 14 technology companies—including Accenture Federal Services, LLC, Fed Reporter, Inc, and S&P Global Market Intelligence, LLC—for inclusion in the next phase of the rapid prototyping competition.

    October 15, 2020 WebPage Regulatory News
    News

    GLEIF Defines New Validation Agent Role for Financial Institutions

    GLEIF announced that financial institutions worldwide can realize a variety of cost, efficiency, and customer experience benefits by assuming a new “validation agent” role within the Global Legal Entity Identifier (LEI) System.

    October 15, 2020 WebPage Regulatory News
    RESULTS 1 - 10 OF 5979