Document ID: chunk:federal_register_of_legislation:F2022L00741:body:0:p7
Version: federal_register_of_legislation:F2022L00741
Segment Type: other
Provision Reference: 
Character Range: 17121–19679

including reporting to senior management against service levels.

Review of insurance management framework

    30.         An RSE licensee must ensure that the appropriateness, effectiveness and adequacy of its insurance management framework are subject to a comprehensive review by operationally independent, appropriately trained and competent persons at least every three years.

    31.         The scope of the comprehensive review of an RSE licensee's insurance management framework must have regard to the size, business mix and complexity of the RSE licensee's business operations, the extent of any change to those operations and any changes to the external environment in which the RSE licensee operates.

    32.         At a minimum, the comprehensive review of the insurance management framework must consider:

(a)          all the matters identified in paragraph 13;

(b)          whether there are any conflicts of interest or duty that may affect the arm's length nature of the insurance arrangement; and

(c)          whether the best financial interests of the beneficiaries may not have been prioritised, after considering:

            (i)            the RSE licensee's business practices in selecting and monitoring an insurer; and

            (ii)         the terms and conditions of the insurance arrangement(s) for making insured benefits available for the beneficiaries.

Transitional arrangements

    33.         Where:

(a)          an RSE licensee has entered into an insurance arrangement with a connected entity of the RSE licensee prior to the effective date; and

(b)          the insurance arrangement ends on or after 1 July 2023,

    the RSE licensee must, before 1 July 2023, seek an independent certification that states it is reasonable for the RSE licensee to form the view that the insurance arrangement is in the best financial interests of the beneficiaries.

    34.         An RSE licensee must provide APRA with an independent certification obtained for the purposes of paragraph 33 no later than 10 business days after the RSE licensee receives the certification.

    35.         Where an RSE licensee is unable to obtain an independent certification, for the purposes of paragraph 33, that states it is reasonable for the RSE licensee to form the view that the insurance arrangement is in the best financial interests of the beneficiaries, the RSE licensee must notify APRA no later than 10 business days after becoming aware that it cannot obtain an independent certification containing that statement.