Australian Securities and Investments Commission Corporations (Confirming Transactions—Deceased Life Insurance Policyholder) Instrument 2023/437 (Cth)

ASIC Corporations (Confirming Transactions—Deceased Life Insurance Policyholder) Instrument 2023/437

I, Rhys Bollen, delegate of the Australian Securities and Investments Commission, make the following legislative instrument.

Date    6 June 2023

Rhys Bollen

Contents

Part 1—Preliminary

1    Name of legislative instrument

2    Commencement

3    Authority

4    Definitions

Part 2—Declaration

5    Confirmation of transactions to a third person in circumstances where the holder of the financial product is deceased

Part 3—Repeal

6    Repeal

Part 1—Preliminary

1        Name of legislative instrument

This is the ASIC Corporations (Confirming Transactions—Deceased Life Insurance Policyholder) Instrument 2023/437.

2        Commencement

This instrument commences on the day after it is registered on the Federal Register of Legislation.

Note:    The register may be accessed at Authority

This instrument is made under paragraph 1020F(1)(c) of the Corporations Act 2001.

4        Definitions

In this instrument:

Act means the Corporations Act 2001.

holder has the same meaning as in paragraph 1017F(1)(a) of the Act.

life company has the meaning given by section 8 of the Life Insurance Act 1995.

relevant life policy means a life policy in relation to which all of the following are satisfied:

(a)     the person to whom the policy was issued (initial owner of the policy) is the same person as the life insured under the policy;

(b)     the initial owner of the policy has deceased;

(c)     when the initial owner deceased, they did not hold the policy jointly with any other person;

(d)     the rights of the initial owner have not been assigned under the Life Insurance Act 1995 or transferred by the operation of the policy;

(e)     on the death of the initial owner, the issuer of the policy has the obligation to pay a sum of money under the policy to a person (third party payee) other than the initial owner or their estate.

Note: The third party payee could include a third party beneficiary for the purposes of subsection 48A(1) of the Insurance Contracts Act 1984, or a person to whom the sum of money is required to be paid in accordance with section 211 or section 212 of the Life Insurance Act 1995.

Part 2—Declaration

5        Confirmation of transactions to a third person in circumstances where the holder of the financial product is deceased

(1) Part 7.9 of the Act applies in relation to a financial product that is a relevant life policy as if section 1017F were modified or varied as follows:

(a)     in subparagraph (1)(b)(ii):

(i)      after “transaction” (first occurring), insert “(other than a transaction referred to in subparagraph (iia))”; and

(ii)     omit “; and”, substitute “; or”;

(b)     after subparagraph (1)(b)(ii), insert:

“(iia) for a product that is a life policy—a transaction by which the issuer of the product pays a sum of money under the product to a person (third party payee) who is not the holder of the product; and

Note:    Subparagraphs (b)(i) and (ii) may also apply in relation to a product that is a life policy.”;

(c)     in subsection (1)(d), before “the holder”, insert “in the case of a transaction referred to in subparagraph (b)(i) or (ii)—”;

(d)     after subsection (1)(d), insert:

“(da) in the case of a transaction referred to in subparagraph (b)(iia)—the third party payee has not waived their right to be provided with confirmation of the transaction”;

(e)     in subsection (2), after “the holder”, insert “(or, in the case of a transaction specified in column 2 of item 4A, the third party payee)”;

(f)     after item 4 of the table in subsection (2), insert:

“4A transaction by which the issuer pays a sum of money under the product to a third party payee the issuer of the product”;

(g)     in subsections (5), (5A) and (7), after “holder” (wherever occurring), insert “or third party payee”;

(h)     after paragraph (8)(a), insert:

“(aa)  in the case of a transaction referred to in subparagraph (b)(iia), identify the third party payee;”;

(i)      in subparagraph (8)(c)(iii), after “holder”, insert “or the third party payee”.

(2) Part 7.9 of the Act applies in relation to a financial product that is a relevant life policy as if subregulation 7.9.63G(2) of the Corporations Regulations 2001 were modified or varied by, after “holder”, inserting “or third party payee”.

Part 3—Repeal

6        Repeal

This instrument is repealed at the start of 1 July 2028.