Medical Indemnity (Prudential Supervision and Product Standards) (Consequential Amendments) Act 2003

Administered by Department of the Treasury

Legislation au C2004A01120 In force Act

Legislation content

 

 

 

 

 

 

Medical Indemnity (Prudential Supervision and Product Standards) (Consequential Amendments) Act 2003

 

No. 36, 2003

 

 

 

 

 

An Act to make amendments consequential on the Medical Indemnity (Prudential Supervision and Product Standards) Act 2003, and for related purposes

 

 

Contents

1 Short title

2 Commencement

3 Schedule(s)

Schedule 1—Consequential amendments

Australian Prudential Regulation Authority Act 1998

Financial Sector (Collection of Data) Act 2001

Insurance Act 1973

Insurance Contracts Act 1984

 

Medical Indemnity (Prudential Supervision and Product Standards) (Consequential Amendments) Act 2003

No. 36, 2003

 

 

 

An Act to make amendments consequential on the Medical Indemnity (Prudential Supervision and Product Standards) Act 2003, and for related purposes

[Assented to 2 May 2003]

The Parliament of Australia enacts:

1  Short title

  This Act may be cited as the Medical Indemnity (Prudential Supervision and Product Standards) (Consequential Amendments) Act 2003.

2  Commencement

  This Act commences, or is taken to have commenced, on 1 July 2003.

3  Schedule(s)

  Each Act that is specified in a Schedule to this Act is amended or repealed as set out in the applicable items in the Schedule concerned, and any other item in a Schedule to this Act has effect according to its terms.


Schedule 1—Consequential amendments

 

Australian Prudential Regulation Authority Act 1998

1  Subsection 56(1) (after paragraph (f) of the definition of Act covered by this section)

Insert:

 (fa) the Medical Indemnity (Prudential Supervision and Product Standards) Act 2003;

Financial Sector (Collection of Data) Act 2001

2  Subsection 5(2)

Repeal the subsection, substitute:

 (2) A financial sector entity is:

 (a) a registered entity; or

 (b) a regulated entity; or

 (c) a corporation to which section 5A applies.

3  After section 5

Insert:

5A  Medical indemnity entities

  This section applies to a corporation at a particular time if:

 (a) the corporation is a financial corporation formed within the limits of Australia; and

 (b) an arrangement under which medical indemnity cover is provided for a health care professional was entered into before 1 July 2003; and

 (c) the arrangement was not effected by means of a contract of insurance; and

 (d) the corporation may pay, or may have to pay, an amount under the arrangement at some time after that time.

Expressions used in paragraph (b) have the same meaning as they have in the Medical Indemnity (Prudential Supervision and Product Standards) Act 2003.

Insurance Act 1973

4  After subsection 12(3)

Insert:

 (3A) Without limiting the circumstances in which APRA may refuse an application, APRA must refuse an application if:

 (a) an arrangement under which medical indemnity cover is provided for a health care professional was entered into before 1 July 2003; and

 (b) the arrangement was not effected by means of a contract of insurance; and

 (c) the applicant may pay, or may have to pay, an amount under the arrangement at some time after the time when the application is made.

Expressions used in paragraph (a) have the same meaning as they have in the Medical Indemnity (Prudential Supervision and Product Standards) Act 2003.

Note 1: This means that an applicant that is an MDO (medical defence organisation) that entered into discretionary medical indemnity arrangements before 1 July 2003 cannot be granted an authorisation under this section while amounts remain potentially payable by the applicant under those arrangements.

Note 2: All medical indemnity arrangements (arrangements under which medical indemnity cover is provided for health care professionals) that are entered into, come into effect or are renewed on or after 1 July 2003 must be by way of contracts of insurance (see section 10 of the Medical Indemnity (Prudential Supervision and Product Standards) Act 2003).

5  Subsection 115(1)

Omit “this Act”, substitute “the relevant legislation”.

6  After subsection 115(1)

Insert:

 (1A) In subsection (1):

relevant legislation means:

 (a) this Act; or

 (b) Part 2 of the Medical Indemnity (Prudential Supervision and Product Standards) Act 2003

7  Subsection 115A(1)

Omit “this Act or the Financial Sector (Collection of Data) Act 2001”, substitute “the relevant legislation”.

8  Paragraph 115A(2)(a)

Omit “this Act or the Financial Sector (Collection of Data) Act 2001”, substitute “the relevant legislation”.

9  Subparagraph 115A(3)(a)(i)

Omit “this Act or the Financial Sector (Collection of Data) Act 2001”, substitute “the relevant legislation”.

10  Paragraph 115A(3)(b)

Omit “this Act”, substitute “the relevant legislation”.

11  Subsection 115A(6)

Repeal the subsection, substitute:

 (5) In this section:

authorized person means APRA or a person authorized by APRA, in writing, for the purposes of this section.

relevant legislation means:

 (a) this Act; or

 (b) the Financial Sector (Collection of Data) Act 2001; or

 (c) Part 2 of the Medical Indemnity (Prudential Supervision and Product Standards) Act 2003.

Insurance Contracts Act 1984

12  Before section 11A

Insert:

11AAA  Definition

  In this Part, unless the contrary intention appears:

relevant legislation means:

 (a) this Act; or

 (b) Part 3 of the Medical Indemnity (Prudential Supervision and Product Standards) Act 2003.

13  Section 11B

Omit “this Act”, substitute “the relevant legislation”.

14  Section 11B

Omit “the Act” (wherever occurring), substitute “the relevant legislation”.

15  Subsection 11C(1)

Omit “this Act”, substitute “the relevant legislation”.

16  Subsection 11D(1)

Omit “this Act”, substitute “the relevant legislation”.

17  Paragraph 11E(a)

Omit “this Act”, substitute “the relevant legislation”.

Note: The heading to section 11E is altered by omitting “Act” and substituting “relevant legislation”.

(285/02)

 

 

 

[Minister’s second reading speech made in—

House of Representatives on 12 December 2002

Senate on 24 March 2003]

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Overview

The Medical Indemnity (Prudential Supervision and Product Standards) (Consequential Amendments) Act 2003 was enacted by the Parliament of Australia to make amendments consequential on the Medical Indemnity (Prudential Supervision and Product Standards) Act 2003. This Act aimed to address the need for regulatory alignment and consistency across various financial and insurance sectors by updating relevant Acts to reflect the changes introduced by the primary Act. It ensures that the regulatory framework governing medical indemnity arrangements is uniformly applied and supervised. The policy objective is to enhance the stability and reliability of the financial sector by ensuring that medical indemnity arrangements are conducted in a manner that is consistent with prudential standards. The Act came into effect on 1 July 2003 and includes consequential amendments to several existing Acts, including the Australian Prudential Regulation Authority Act 1998, the Financial Sector (Collection of Data) Act 2001, the Insurance Act 1973, and the Insurance Contracts Act 1984. These amendments are designed to integrate the provisions of the Medical Indemnity (Prudential Supervision and Product Standards) Act 2003 into the broader regulatory framework, ensuring that medical indemnity arrangements are appropriately supervised and that entities involved in such arrangements comply with the necessary standards and regulations.

Scope and Application

The Medical Indemnity (Prudential Supervision and Product Standards) (Consequential Amendments) Act 2003 applies to various entities within the financial sector, specifically those corporations that provide medical indemnity arrangements for health care professionals. These arrangements must be governed by contracts of insurance if they were entered into, came into effect, or were renewed on or after 1 July 2003, as mandated by the primary Act. The scope of the legislation extends to amendments of the Australian Prudential Regulation Authority Act 1998, the Financial Sector (Collection of Data) Act 2001, the Insurance Act 1973, and the Insurance Contracts Act 1984, to reflect changes in medical indemnity practices. The Act also restricts the Australian Prudential Regulatory Authority (APRA) from granting authorisation to entities that have entered into certain medical indemnity arrangements before the specified date, unless those arrangements are via contracts of insurance. The Act’s provisions apply nationally across Australia, ensuring uniformity in the regulation of medical indemnity arrangements within the financial sector.

Key Provisions

The Medical Indemnity (Prudential Supervision and Product Standards) (Consequential Amendments) Act 2003 (C2004A01120) makes amendments to several Acts to align with the Medical Indemnity (Prudential Supervision and Product Standards) Act 2003. The primary sections of the Act pertain to consequential amendments of existing legislation, including the Australian Prudential Regulation Authority Act 1998, the Financial Sector (Collection of Data) Act 2001, the Insurance Act 1973, and the Insurance Contracts Act 1984. These amendments ensure that the changes introduced by the principal Act are reflected in the relevant laws, thereby maintaining consistency across the regulatory framework. The Act imposes several obligations on the entities governed by these amended Acts. For instance, Section 1 of the Australian Prudential Regulation Authority Act 1998 is amended to include the Medical Indemnity (Prudential Supervision and Product Standards) Act 2003 within the definition of "Act covered by this section." Additionally, Section 5A introduces a new definition for "medical indemnity entities," which applies to corporations that have entered into arrangements for medical indemnity cover before 1 July 2003 and may be liable to pay under these arrangements after that date. Similarly, Section 115A(1) of the Insurance Act 1973 is modified to include the "relevant legislation," which now encompasses the Medical Indemnity (Prudential Supervision and Product Standards) Act 2003, thereby ensuring that the Act's provisions are integrated into the existing insurance regulatory framework. The Act also establishes specific consequences for non-compliance with its provisions. For example, Section 3A of the Insurance Act 1973 mandates that the Australian Prudential Regulatory Authority (APRA) must refuse an application if it is determined that the applicant may pay, or may have to pay, an amount under an arrangement for medical indemnity cover that was entered into before 1 July 2003, provided the arrangement was not effected by means of a contract of insurance. This ensures that only arrangements made in compliance with the new standards are authorised. The Act does not explicitly state penalties for breaches, but it implies that non-compliance with the specified conditions could lead to refusal of applications, thereby indirectly enforcing adherence to the new standards and regulatory requirements.

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Sourced from the Federal Register of Legislation at 26 August 2026. For the latest information on Australian Government law please go to https://www.legislation.gov.au.