EXPLANATORY STATEMENT
STATUTORY RULES 1989 NO 82.
INSURANCE SUPERVISORY LEVIES COLLECTION REGULATIONS
ISSUED BY AUTHORITY OF THE TREASURER
The Insurance Supervisory Levies Collection Act 1989 (the Act) provides for the collection of the annual supervisory levies imposed on authorised general insurers, Lloyd’s and registered life insurers by the General Insurance Supervisory Levy Act 1989 and the Life Insurance Supervisory Levy Act 1989. The Act is aimed at recovering the ongoing costs of supervision of such bodies under the Insurance Act 1973 and the Life Insurance Act 1945 by the Insurance and Superannuation Commissioner.
These regulations prescribe a number of administrative matters which are necessary to ensure the efficient and effective collection of the levies.
Regulation 3 allows for remission from the full amount of the levy for insurers authorised under section 37 of the Insurance Act. The activities of these insurers are confined to conducting insurance business with limited classes of persons (generally only members or employees of the company or the particular trade, industry or profession) and one of the pre-conditions of their authority is that their premium income does not exceed $500,000 per annum. These insurers are exempted from certain provisions of the Act, principally involving a reduced statutory reporting requirement, and consequently there is a reduced supervisory responsibility in respect of these companies on the part of the Insurance and Superannuation Commissioner.
A brief outline of the regulations is attached.
Insurance and Superannuation Commission
CANBERRA ACT
ATTACHMENT
Details of the Regulations
Regulation 1 provides for the manner of citation of the regulations.
Regulation 2 provides that a reference to “the Act” in the regulations is a reference to the Insurance Supervisory Levies Collection Act 1989.
Regulation 3 allows for the remission of an amount of $9,000 from the annual rate of levy payable by insurance companies authorised under section 37 of the Insurance Act 1973. The effect of this regulation is to relieve these insurers from liability for the full amount of the levy and, after allowing for the amount remitted, result in their liability being determined on an annual rate of levy of $2,000.
Regulation 4 provides for the levy and other amounts payable to the Commonwealth under the Act to be made to the Receiver of Public Moneys at offices of the Commissioner located in Canberra, Sydney and Melbourne.
Regulation 5 makes provision for the refund by the Commissioner of overpayments where the amount paid by a person to the Commissioner exceeds that person’s liability under the Act.
Overview
The Insurance Supervisory Levies Collection Regulations 1989 were enacted to facilitate the collection of annual supervisory levies on authorised general insurers, Lloyd's, and registered life insurers, as stipulated by the General Insurance Supervisory Levy Act 1989 and the Life Insurance Supervisory Levy Act 1989. This legislative framework was introduced to address the need for recovering the ongoing costs of supervision, which are overseen by the Insurance and Superannuation Commissioner under the Insurance Act 1973 and the Life Insurance Act 1945. The regulations were issued by authority of the Treasurer and aim to ensure the efficient and effective collection of these levies. They provide administrative details necessary for the collection process, including remission provisions for certain insurers and guidelines on where and how levies should be paid to the Commonwealth.
Scope and Application
The Insurance Supervisory Levies Collection Regulations 1989, issued under the authority of the Treasurer, implement the Insurance Supervisory Levies Collection Act 1989, which provides for the collection of annual supervisory levies on authorised general insurers, Lloyd’s and registered life insurers. This legislation aims to recover the costs associated with the supervision of these entities by the Insurance and Superannuation Commissioner, as stipulated under the Insurance Act 1973 and the Life Insurance Act 1945. The regulations apply to authorised general insurers, Lloyd’s and registered life insurers within Australia, ensuring they contribute to the costs of their supervision. Notably, insurers authorised under section 37 of the Insurance Act 1973, whose activities are limited to specific classes of persons and whose premium income does not exceed $500,000 per annum, are eligible for a remission of $9,000 from the full levy, reducing their annual levy liability to $2,000. Payments under the Act must be made to the Receiver of Public Moneys at specified offices of the Commissioner in Canberra, Sydney, and Melbourne, and provisions are made for refunds of overpayments.
Key Provisions
The Insurance Supervisory Levies Collection Regulations 1989, issued under the authority of the Treasurer, are designed to facilitate the collection of annual supervisory levies from authorised general insurers, Lloyd’s and registered life insurers as stipulated in the Insurance Supervisory Levies Collection Act 1989 (the Act). These levies are intended to cover the ongoing costs of supervision by the Insurance and Superannuation Commissioner under the Insurance Act 1973 and the Life Insurance Act 1945. Regulation 3 of the Act allows for a remission of $9,000 from the annual rate of levy for insurers authorised under section 37 of the Insurance Act 1973, which covers insurers whose business is limited to specific classes of persons such as members or employees of a company or particular trade, industry or profession, with a premium income not exceeding $500,000 per annum.
The regulations impose specific obligations on the entities they govern. Insurers are required to remit their supervisory levies to the Receiver of Public Moneys at designated offices of the Commissioner in Canberra, Sydney, and Melbourne, as outlined in Regulation 4. Furthermore, Regulation 5 mandates that the Commissioner must refund any overpayments made by insurers, ensuring that the amount collected does not exceed the liability of the insurer under the Act. These provisions ensure a structured and efficient process for the collection of supervisory levies, while also providing mechanisms for adjustments and refunds where necessary.
Breaching the obligations set forth in the Insurance Supervisory Levies Collection Regulations 1989 can lead to various consequences. While the regulations do not explicitly outline specific offences or penalties within the text, the Act itself, as well as related legislative frameworks, may impose penalties for non-compliance. Failure to remit the required supervisory levies on time or in the correct amount could result in civil or administrative penalties. Although the exact penalties are not detailed in the regulations, they could potentially include fines or other enforcement actions as stipulated in the broader legislative context. It is important for insurers to adhere to these requirements to avoid any legal repercussions or additional costs associated with non-compliance.