APRA strengthens appointed actuary role within insurers

The Australian Prudential and Regulation Authority (APRA) has released a final package of measures to clarify and strengthen the role of the appointed actuary within general, life and private health insurers.

All APRA-regulated insurers are required by law to designate an appointed actuary, who provides independent advice to boards and senior management on key financial risks, the regulator said.

Following consultation papers released in June 2016 and September 2017, APRA released details of two new prudential standards: CPS 320 and GPS 340.

It said the creation of a new cross-industry prudential standard, CPS 320, harmonised the requirements and expectations for appointed actuaries across all three insurance sectors, while still accommodating industry-specific differences.

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APRA executive board member Geoff Summerhayes said under these changes, appointed actuaries should be able to maintain greater focus on the most material matters and better protect the interests of their insurer and its policyholders.

“The changes are intended to make it easier for insurers to find and retain appropriately qualified professionals to fill this important role,” he said.

“APRA developed the standards to address concerns about high turnover and declining seniority among appointed actuaries.

“Applying the requirements of CPS 320 and GPS 340 will increase flexibility, streamline requirements and clarify the seniority of the appointed actuary within insurers.”