Document ID: chunk:federal_register_of_legislation:F2024L01523:body:0:p3
Version: federal_register_of_legislation:F2024L01523
Segment Type: other
Provision Reference: 
Character Range: 6792–9916

made.
 2.              A private health insurer's ICAAP must be appropriate to the private health insurer's size, business mix and the complexity of its operations.
 3.          A private health insurer that is part of a group may rely on the ICAAP of the group provided that the Board of the private health insurer is satisfied that the group ICAAP meets the criteria in paragraph 11 in respect of the private health insurer.
 4.          The ICAAP must include at a minimum:
         1.           adequate policies, procedures, systems, controls and personnel to identify, measure, monitor and manage the risks arising from the private health insurer's activities on a continuous basis, and the capital held against such risks;
         2.           a strategy for ensuring adequate capital is maintained over time, including specific capital targets set in the context of the private health insurer's risk profile, the Board's risk appetite and regulatory capital requirements. This includes plans for how target levels of capital are to be met and the means available for sourcing additional capital where required;
         3.           actions and procedures for monitoring the private health insurer's compliance with its regulatory capital requirements and capital targets. This includes the setting of triggers to alert management to, and specified actions to avert and rectify, potential breaches of the regulatory capital requirements;
         4.           stress testing and scenario analysis relating to potential risk exposures and available capital resources;
         5.           processes for reporting on the ICAAP and its outcomes to the Board and senior management of the private health insurer, and for ensuring that the ICAAP is taken into account in making business decisions;
         6.            policies to address the capital impact of material risks not covered by explicit regulatory capital requirements; and
         7.           an 'ICAAP summary statement' as defined in paragraph 12.
 5.          The ICAAP summary statement is a high level document that describes and summarises the capital assessment and management processes of the private health insurer. It must outline at a minimum the aspects of the ICAAP listed in paragraphs 11(a) to 11(f) and this paragraph. The ICAAP summary statement must also include:
         1.           a statement of the objectives of the ICAAP, the expected level of financial soundness associated with the capital targets and the time horizon over which the ICAAP applies;
         2.           a description of the key assumptions and methodologies utilised by the private health insurer in its ICAAP, including stress testing and scenario analysis;
         3.           triggers for reviewing the ICAAP in light of changes to business operations, regulatory, economic and financial market conditions, and other factors affecting the private health insurer's risk profile and capital resources;
         4.           a summary of the private health insurer's policy for reviewing its ICAAP, including who is responsible for the review, details of