The Australian Prudential Regulation Authority (APRA) today issued a discussion paper and draft prudential standards outlining a proposed strengthening of the prudential supervision of general insurance in the areas of capital adequacy, assets in Australia and custodian requirements.

APRA Member, Mr Steve Somogyi, said that the proposed reforms in these areas follow the more substantive risk and financial management reform proposals that were made available for public discussion in May 2005.

“These proposals complete the picture for the second round of general insurance reforms by providing details of a number of technical changes. The proposed changes promote the continuing prudential soundness of the Australian general insurance industry and the protection of Australian policyholders,” Mr Somogyi said.

Comments on the discussion paper, Prudential Supervision of General Insurance Stage 2 Reforms – Capital, Assets in Australia and Custodian Requirements, and the draft prudential standards are invited by 28 November 2005 and can be emailed to giregime@apra.gov.au

APRA’s discussion paper and the draft prudential standards are available on APRA’s web site at: http://www.apra.gov.au/General/Draft-Prudential-Standards-General-Insurance-Capital-Assets-in-Australia-and-Custodian-Requirements.cfm

The Australian Prudential Regulation Authority (APRA) is the prudential regulator of the financial services industry. It oversees banks, credit unions, building societies, general insurance and reinsurance companies, life insurance, friendly societies, and most members of the superannuation industry.
APRA is funded largely by the industries that it supervises. It was established on 1 July 1998. APRA currently supervises institutions holding approximately $2.0 trillion in assets for 20 million Australian depositors, policyholders and superannuation fund members.