The Australian Prudential Regulation Authority (APRA) has released for
consultation a package of draft prudential standards and guidance for the life insurance industry, including friendly societies.

The package aims to establish APRA’s minimum expectations for risk management and business continuity in the life industry and to bring a number of prudential requirements for life companies and friendly societies into line with other APRA-regulated industries.

The package comprises:

• a discussion paper;
• draft prudential standard and prudential practice guide on risk management;
• draft prudential practice guides on:
  • asset and liability management;
  • conflicts of interest under Section 48 of the Life Insurance Act (duties of directors to policyholders);
  • operational risk; and
  • insurance risk and reinsurance management.
• a draft prudential standard and prudential practice guide on business continuity management.

Comments on the discussion paper, draft standards and draft prudential practice guides are invited by 31 December 2006.