Notice varying conditions on Authorisation to carry on insurance business
Insurance Act 1973
TO: Stewart Title Limited 59 101 720 101 (the general insurer)
Level 5, 54 Miller Street, NORTH SYDNEY NSW 2060 SINCE
- 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 10th March 2003 (the Authorisation); and
- the Authorisation is subject to conditions,
I, Brandon Kong Leong Khoo, 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 takes effect, the conditions which apply to the Authorisation are set out in the attached Schedule of consolidated conditions.
Dated: 25 February 2015
[Signed]
Brandon Kong Leong Khoo Executive General Manager Specialised Institutions Division
Interpretation Document ID: 216534
In this Notice
APRA means the Australian Prudential Regulation Authority. insurance business has the meaning given in section 3 of the Act. prudential standard 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(2) of the Act, a condition may be expressed to have effect despite anything in
the prudential standards.
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 that the action has been taken is published in the Gazette.
Note 4
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.
Note 5
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 Appeals Act 1975, apply to the Administrative Appeals Tribunal for review of the reconsidered decision.
The address where written notice may be given to APRA is Level 26, 400 George Street, SYDNEY NSW 2000.
Schedule - the conditions which are being varied
The existing condition(s) which are to be varied:
The company shall not carry on insurance business other than the business of property title insurance business, being insurance that provides an indemnity to owners, purchasers, tenants and lenders against losses associated with title to, or conveyancing of, interests in real property.
The condition(s) as varied are:
The company shall not carry on insurance business other than the business of property title insurance business, being insurance that indemnifies an insured against losses associated with or arising from defects in the title to, or conveyancing of, interests in real property.
Schedule of consolidated conditions
The company shall not carry on insurance business other than the business of property title insurance business, being insurance that indemnifies an insured against losses associated with or arising from defects in the title to, or conveyancing of, interests in real property.
Overview
The Notice varying conditions on the Authorisation to carry on insurance business is a document issued under the Insurance Act 1973, which was enacted to regulate the insurance industry in Australia and ensure that insurance companies operate in a safe and sound manner. This particular notice was issued by Brandon Kong Leong Khoo, a delegate of the Australian Prudential Regulation Authority (APRA), on 25 February 2015. It pertains to Stewart Title Limited, a general insurer that holds an Authorisation to conduct insurance business in Australia, issued by APRA on 10 March 2003. The notice varies the conditions imposed on the insurer's authorisation, specifically relating to the type of insurance business the company is permitted to undertake. The policy objective of the Insurance Act 1973 is to maintain the financial stability of the insurance industry, thereby protecting policyholders and promoting confidence in the insurance market.
Scope and Application
The Insurance Act 1973 applies to entities authorised to carry on insurance business in Australia, including the general insurer in this case, Stewart Title Limited, which operates under an authorisation granted by the Australian Prudential Regulation Authority (APRA). This Act regulates the insurance industry with a focus on prudential matters to ensure the stability and soundness of the industry. The scope of the Act extends across the Commonwealth of Australia, applying uniformly regardless of state or territory boundaries. APRA, as the regulator, has the authority to impose, vary, or revoke conditions on the authorisations granted under the Act, which must pertain to prudential matters. Notably, the Act does not exempt any insurer from its requirements, although specific conditions may be tailored to the nature of the insurance business being conducted. The Act also provides avenues for review and appeal of APRA's decisions regarding authorisation conditions, ensuring that the process remains fair and transparent. The Act’s application is further extended through subordinate instruments, which may include prudential standards and other regulatory guidelines that flesh out the operational framework within which authorised insurers must conduct their business.
Key Provisions
The key operative sections of the Notice are sections 12, 13, and 14 of the Insurance Act 1973. Section 12 permits the Australian Prudential Regulation Authority (APRA) to issue an authorisation for a person to carry on insurance business, subject to specific conditions. Section 13 allows APRA to impose, vary, or revoke conditions on the authorisation at any time, provided the conditions relate to prudential matters. Section 14 sets out the criminal offence and penalties for non-compliance with the conditions of the authorisation. The Notice varies the conditions on the authorisation for Stewart Title Limited, a general insurer, as specified in the attached Schedule. The varied condition now restricts the company to providing insurance that indemnifies an insured against losses associated with or arising from defects in the title to, or conveyancing of, interests in real property.
The Notice imposes several obligations and requirements on Stewart Title Limited. First, it must comply with the varied conditions on its authorisation, specifically limiting its insurance business to indemnifying insureds against losses associated with or arising from defects in the title to, or conveyancing of, interests in real property. Second, the company must ensure it does not carry on any other insurance business outside the scope of the authorisation. Third, if the company does an act or fails to do an act that results in a contravention of the conditions of the authorisation, it commits an offence under section 14 of the Act. The company is also required to notify APRA of any changes to its business activities that may affect its compliance with the authorisation conditions. Additionally, if the company is dissatisfied with a reviewable decision by APRA, it may seek reconsideration or apply to the Administrative Appeals Tribunal for review.
Breach of the conditions on the authorisation constitutes an offence under section 14 of the Act, which is an offence of strict liability. The penalty for an offence under section 14(1) is 300 penalty units, and where an individual commits the offence, the penalty is not exceeding 60 penalty units. Under section 14(2) of the Act, an offence against section 14 is an offence of strict liability, meaning that the company or an individual associated with the company can be held liable for the offence even if there was no intention or negligence on their part. If the company or an individual is found guilty of an offence under section 14, they may face criminal prosecution, which could result in fines or imprisonment. Additionally, the company's authorisation to carry on insurance business may be revoked, which could have significant consequences for its operations.