Notice varying conditions on an authorisation to carry on insurance business in Australia
Insurance Act 1973
To: Employers Mutual Limited ABN 67 000 006 486 (‘the general insurer’)
SINCE:
- APRA issued to the general insurer an Authorisation to carry on insurance business in Australia under subsection 12(1) of the Act, on 2 July 2002 (the Authorisation); and
- The Authorisation is subject to conditions,
I, John Huijsen, a delegate of APRA, under paragraph 13(1)(b) of the Act, VARY those conditions imposed on the Authorisation in the manner specified in the attached Schedule.
When this Notice commences, the conditions which apply to the Authorisation are set out in the attached Schedule of consolidated conditions.
This notice commences on the date of this Notice.
Dated: 28 February 2025
John Huijsen[1]
Acting Executive Director
General Insurance and Banking Division
Interpretation
In this Notice:
Act means the Insurance Act 1973.
APRA means the Australian Prudential Regulation Authority.
insurance business has the meaning given in subsection 3(1) of the Act.
Note 1 Under subsection 13(1) of the Act, APRA may, at any time, by written notice to a general insurer, impose conditions or additional conditions or vary or revoke conditions imposed on the insurer’s authorisation.
Note 2 Under section 13 of the Act, APRA may impose conditions or additional conditions on a general insurer’s authorisation provided the conditions relate to prudential matters.
Note 3 Under subsection 13(4) of the Act, if APRA imposes, varies or revokes the conditions on a general insurer’s authorisation, APRA must give written notice to the insurer and ensure that notice of the action is published in the Gazette.
Note 4 Under subsection 13(6) of the Act, a decision to impose conditions, or additional conditions, or to vary the conditions on the Authorisation are reviewable decisions to which Part VI of the Act applies. If you are dissatisfied with a reviewable decision, you may seek reconsideration of the decision by APRA in accordance with subsection 63(2) of the Act. The request for reconsideration must be in writing, must state the reasons for the request and must be given to APRA within 21 days after the decision first comes to your notice or within such further period as APRA allows. If
dissatisfied with APRA’s reconsidered decision confirming or varying the first decision, you may, subject to the Administrative Review Tribunal Act 2024, apply to the Administrative Review Tribunal (ART) for review of the reconsidered decision.
The address where written notice may be given to APRA is Level 12, 1 Martin Place Sydney NSW 2000 and by email to the relevant APRA Supervisor.
Schedule – the condition(s) on Authorisation which are to be varied
The existing condition(s) which are to be varied:
- The general insurer must not issue policies of insurance other than policies that meet the following criteria:
- the policies are issued in respect of public and/or product liability; or
- the policies are issued in respect of workers’ compensation.
The condition(s) as varied:
- The general insurer must not issue policies of insurance other than policies that meet the following criteria:
- the policies are issued in respect of public and/or product liability; or
- the policies are issued in respect of workers’ compensation; or
- the policies are issued in respect of sickness and accident on a group basis.
Schedule of consolidated conditions
- The general insurer must not issue policies of insurance other than policies that meet the following criteria:
- the policies are issued in respect of public and/or product liability; or
- the policies are issued in respect of workers’ compensation; or
- the policies are issued in respect of sickness and accident on a group basis.
Overview
The Insurance Act 1973 was enacted to address the need for a comprehensive regulatory framework governing the insurance industry in Australia. This legislation provides the Australian Prudential Regulation Authority (APRA) with the power to authorise insurance companies to operate in Australia, and to impose, vary, or revoke conditions on those authorisations to ensure the stability and soundness of the insurance sector. The Act serves to protect policyholders and maintain public confidence in the insurance industry by ensuring that insurers are adequately capitalised, solvent, and manage risks prudently. APRA, as the enacting body, exercises its powers under the Act to safeguard the interests of policyholders, while allowing insurers the flexibility to innovate and compete within a regulated environment. The overarching policy objective is to maintain the financial health and stability of the insurance industry, thus providing security to those who rely on insurance products.
Scope and Application
The Notice varying conditions on an authorisation to carry on insurance business in Australia, issued under the Insurance Act 1973, applies specifically to Employers Mutual Limited, an authorised general insurer with the Australian Business Number (ABN) 67 00 006 486. This Notice, issued by John Huijsen, a delegate of the Australian Prudential Regulation Authority (APRA), modifies the conditions of the authorisation granted to the insurer on 2 July 2002. The varied conditions now allow the insurer to issue policies for sickness and accident on a group basis, in addition to the previously permitted public and/or product liability and workers’ compensation policies. This variation is effective from the date of the Notice, 28 February 2025, and is applicable nationally across Australia. The Notice does not introduce any exclusions or exemptions to the conditions previously in place, but rather expands the scope of permissible insurance business. Decisions to vary these conditions are reviewable under Part VI of the Act, with avenues for reconsideration and appeal available if the insurer is dissatisfied with the decision.
Key Provisions
The Notice, issued under the authority of the Australian Prudential Regulation Authority (APRA) and as a delegate of APRA, pertains to the variation of conditions on an authorisation to carry on insurance business in Australia (subsection 13(1)(b) of the Insurance Act 1973). The authorisation in question, granted to Employers Mutual Limited on 2 July 2002, is now subject to modified conditions as outlined in the attached Schedule (subsection 13(1) of the Act). The Notice comes into effect on the date of issue, 28 February 2025.
The key modification to the authorisation conditions involves expanding the types of insurance policies that Employers Mutual Limited is permitted to issue. Specifically, the insurer is now allowed to issue policies not only for public and/or product liability and workers’ compensation, but also for sickness and accident on a group basis. These varied conditions are detailed in the Schedule of consolidated conditions, which supersedes the previous conditions and comes into effect from the date of this Notice.
Employers Mutual Limited, as the entity governed by this Notice, must adhere to the new conditions specified. This includes ensuring that any insurance policies issued comply with the expanded criteria, namely those related to public and/or product liability, workers’ compensation, and sickness and accident on a group basis. The insurer must refrain from issuing policies outside these specified categories to remain compliant with the authorisation.
In the event of non-compliance with the conditions outlined in the Notice, Employers Mutual Limited may face significant consequences. While the Notice does not explicitly detail specific penalties for breaches, the Insurance Act 1973 provides for a range of enforcement actions, including potential fines, revocation of authorisation, and other administrative or legal actions. The severity of penalties can depend on the nature and extent of the breach, with potential maximum penalties being considerable under the relevant provisions of the Act.