Following the appointment of a provisional liquidator to the general insurance group HIH, many people have asked whether other general insurers have similar problems. The Australian Prudential Regulation Authority (APRA) advises that HIH is not typical of other large insurance companies. There are no other significant insurers about which APRA has the numerous questions and concerns that it pursued with HIH over the past several months. APRA also notes that reform of the current prudential framework covering general insurance (which dates from 1973) has been a key policy priority for APRA over the past two years. As a result of that work, APRA and the Government are moving to introduce new legislation and standards that will significantly strengthen the prudential supervision regime applying to insurers and improve the protection of policyholders. APRA issued the latest version of its proposed reforms on 29 March 2001.

NRMA

Another large insurance company  NRMA Insurance Ltd  has been in the news recently. While there is no doubt about the financial strength of NRMA, APRA fully agrees with the Australian Securities and Investments Commission that NRMA needs urgently to put its recent Board problems behind it and to restore stability to its senior management.

APRA is meeting today with NRMAs interim Chairman and interim CEO to stress the importance of achieving these objectives.

For further information contact:

Gloria Peterson
Public Affairs Manager
02 9210 3385 or 0419 250 286