APRA updates commonplace for offshore reinsurance
14 March 2022
The Australian Prudential Regulation Authority (APRA) has up to date a regular to scale back dangers from the rising use of offshore reinsurers by the life trade.
Deputy Chairman Helen Rowell says the finalisation of LPS 117 is a major milestone that can strengthen APRA oversight whereas guaranteeing ongoing entry to offshore advantages that embody an additional supply of capability and an avenue to entry competitively priced help for progressive product designs.
“When threat is positioned offshore, APRA has a restricted potential to make sure reinsurance preparations adequately safeguard policyholders and insurer resilience,” she stated.
“The up to date LPS 117 addresses this by offering a balanced strategy to mitigating these dangers, setting applicable limits in order that Australian life insurers can proceed utilizing the offshore reinsurance market in a prudent method.”
APRA is searching for extra suggestions on a small variety of amendments arising from a session on accounting adjustments and Life and Common Insurance coverage Capital (LAGIC) framework updates, with remark open till April 29.
The revised LPS 117 will begin from July 1 subsequent yr, aligning with adjustments anticipated to prudential capital requirements as a result of introduction of AASB 17 Insurance coverage Contracts accounting preparations.
Extra particulars can be found right here.