Insurance Supervisory Levies Collection Regulations (Amendment)

Overview

The Insurance Supervisory Levies Collection Regulations (Amendment) 2004, issued under the authority of the Treasurer, amend the Insurance Supervisory Levies Collection Regulations 1990, which were established to facilitate the collection of annual supervisory levies imposed on authorised general insurers, Lloyd's insurers, and registered life insurers as mandated by the General Insurance Supervisory Levy Act 1989 and the Life Insurance Supervisory Levy Act 1989. This regulatory framework is designed to recover the ongoing costs associated with the supervision of these entities by the Insurance and Superannuation Commissioner, in accordance with the Insurance Act 1973 and the Life Insurance Act 1945. The amendment specifically adjusts the remission amount for insurers authorised under section 37 of the Insurance Act, increasing it from $9,000 to $9,600, thereby maintaining the annual rate of levy at $2,000. This adjustment follows an increase in the annual supervisory levy from $11,000 to $11,600, reflecting the need to balance the supervisory costs against the lesser supervisory effort required for these insurers.

Scope and Application

The Insurance Supervisory Levies Collection Regulations (Amendment) 1990, under the authority of the Treasurer, pertains to the collection of annual supervisory levies imposed on authorised general insurers and Lloyd’s, as well as registered life insurers, as stipulated by the General Insurance Supervisory Levy Act 1989 and the Life Insurance Supervisory Levy Act 1989 respectively. This regulation aims to ensure the ongoing costs of supervision of these entities, as governed by the Insurance Act 1973 and the Life Insurance Act 1945, are recovered by the Insurance and Superannuation Commissioner. The amended regulation increases the remission from the full amount of the levy for insurers authorised under section 37 of the Insurance Act from $9,000 to $9,600, maintaining the annual rate of levy at $2,000 following the increase in the annual rate of the supervisory levy from $11,000 to $11,600. This amendment acknowledges the significantly lower supervisory effort required for these insurers.

Key Provisions

The Insurance Supervisory Levies Collection Regulations (Amendment) (C2004L00106) amends the existing Insurance Supervisory Levies Collection Regulations, specifically Regulation 3, to adjust the remission amount for certain authorised general insurers (section 3). The primary purpose of this amendment is to ensure that the supervisory levy accurately reflects the varying levels of supervisory effort required by different types of insurers. Insurers authorised under section 37 of the Insurance Act 1973 will benefit from an increased remission from $9,000 to $9,600, while the annual rate of the levy for these insurers remains at $2,000. These amendments impose specific obligations on authorised general insurers who are eligible for the increased remission. They must ensure they meet all criteria set out in section 37 of the Insurance Act and comply with the updated remission amount, as stipulated in the amended Regulation 3. The Insurance and Superannuation Commission (ISC) will closely monitor these insurers to ensure the correct application of the remission. Insurers must provide any necessary documentation or evidence to substantiate their eligibility for the remission to the ISC upon request. Breach of the requirements set out in these regulations could lead to enforcement actions by the ISC. Under the Insurance Supervisory Levies Collection Act 1989, failure to accurately report the supervisory levy or incorrectly claim the remission could result in civil or criminal penalties. The maximum penalties for non-compliance include fines of up to $22,200 for individuals and up to $111,000 for corporations, as determined under the relevant Acts. Additionally, the ISC has the authority to initiate legal proceedings against non-compliant insurers to recover any unpaid levies and associated costs.