Australian superannuation funds would likely find themselves confronting an increase in the number of people seeking the early release of benefits in the event of a pandemic such as bird flu, according to the Australian Prudential Regulation Authority (APRA).
APRA this week released an information paper on pandemic planning in the financial services industry and pointed to increasing pressure on superannuation funds as being one of the likely outcomes.
It said that with respect to superannuation, a pandemic might lead to some increase in eligible individuals electing to commence benefits and an increase in requests for early release of benefits.
“It is important that administrators of superannuation funds and other managed investment funds consider how they would maintain basic operations if their staffing levels or services providers were affected in a pandemic,” the APRA paper warned.
The regulator said that it was currently conducting a stress test of insurance companies based on several pandemic scenarios in order to gauge overall levels of potential pandemic-related insurance exposures.
It said that stress testing of other sectors was possible if the circumstances warranted.
