Notice revoking conditions on Authorisation to carry on insurance business
Insurance Act 1973
TO: Sovereign Insurance Australia Pty Ltd ABN 85 138 079 286 (the general insurer)
61 Shepperton Road, VICTORIA PARK WA 6100
SINCE
A. APRA issued to the general insurer an Authorisation to carry on insurance business in
Australia under subsection 12(1) of the Insurance Act 1973 (the Act), on 1 November
2009 (the Authorisation); and
B. the Authorisation is subject to conditions,
I, Brandon Kong Leong Khoo, a delegate of APRA, under paragraph 13(1)(b) of the Act, REVOKE those conditions specified in the attached Schedule.
When this Notice takes effect, the conditions which apply to the Authorisation are set out in the attached Schedule of consolidated conditions.
Dated: 23 January 2013
[Signed]
Brandon Kong Leong Khoo
Specialised Institutions Division
Interpretation Document ID: 207385
In this Notice
APRA means the Australian Prudential Regulation Authority.
insurance business has the meaning given in section 3 of the Act.
Note 1
Under subsection 13(1) of the Act, APRA may, at any time, by written notice to the general insurer
impose conditions or additional conditions or vary or revoke conditions imposed on the insurer's authorisation under section 12 of the Act. The conditions must relate to prudential matters.
Note 2
Under subsection 13(4) of the Act, if APRA revokes conditions on a general insurer's authorisation,
APRA must give written notice to the insurer and ensure that notice that the action has been taken is published in the Gazette.
Note 3
Under subsection 14(1) of the Act, a general insurer commits an offence if:
(a) the insurer does an act or fails to do an act; and
(b) doing the act or failing to do the act results in a contravention of a condition of the insurer's authorisation under section 12 of the Act; and
(c) there is no determination in force under subsection 7(1) of the Act, that subsection 14(1) of the Act does not apply to the insurer.
The penalty is 300 penalty units. Under subsection 14(1A) of the Act, where an individual commits an offence against subsection 14(1) of the Act, because of Part 2.4 of the Criminal Code or commits an offence under Part
2.4 of the Criminal Code in relation to an offence against subsection 14(1) of the Act, the individual is punishable, on conviction, by a penalty not exceeding 60 penalty units. Under subsection 14(2) of the Act, an
offence against section 14 of the Act, is an offence of strict liability.
Schedule -the conditions which are being revoked
2. Sovereign Australia must have the higher of a capital base of $7. Sm or 1. 5 times MCR by 31 October 2010 where the capital base and MCR are calculated in accordance with the methodology set out in Prudential Standard GPS 110 Capital Adequacy.
Schedule of consolidated conditions
1. The general insurer may only carry on an insurance business in Australia for the purpose of:
a. Undertaking liability under contracts of Consumer Credit Insurance (excluding life cover) and Motor Vehicle Guaranteed Asset Protection (GAP) Insurance issued to customers of the John Hughes Group in connection with the Group’s sale or financing of motor vehicles; and
b. Reinsuring contracts of Consumer Credit Insurance (excluding life cover) and Motor Vehicle Guaranteed Asset Protection (GAP) Insurance entered into by Sovereign Insurance Pty Ltd on or before 31 October 2009.
Notes:
The John Hughes Group comprises Gilpin Park Pty Ltd ACN 009 052 797 and companies which are associates of it for the purposes of the Financial Sector (Shareholdings) Act 1998.