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FINANCIAL SECTOR LEGISLATION AMENDMENT ACT (NO. 1) 2002 NO. 37, 2002 - SCHEDULE 4

- Amendments relating to general insurance

Insurance Act 1973

1 Paragraph 25(1)(a)

Repeal the paragraph, substitute:

(a)
the person has been convicted of an offence against or arising out of:

(i)
this Act; or
(ii)
the Financial Sector (Collection of Data) Act 2001 ; or
(iii)
the Corporations Act 2001 , the Corporations Law that was previously in force, or any law of a foreign country that corresponds to that Act or to that Corporations Law; or

2 At the end of subsection 25(1)

Add:

; or (f) APRA has disqualified the person under section 25A.

3 After section 25

Insert:

(1) APRA may disqualify a person if it is satisfied that the person is not a fit and proper person to be or to act as someone referred to in paragraph 24(1)(a), (b) or (c).
(2) A disqualification takes effect on the day on which it is made.
(3) APRA may revoke a disqualification on application by the disqualified person or on its own initiative. A revocation takes effect on the day on which it is made.
(4) APRA must give the person written notice of a disqualification, revocation of a disqualification or a refusal to revoke a disqualification.
(5) As soon as practicable after a notice is given to a person under subsection (4), APRA must cause particulars of the disqualification, revocation or refusal to which the notice relates:

(a)
to be given:

(i)
if the person is, or is acting as, a person referred to in paragraph 24(1)(a)—to the general insurer concerned; or
(ii)
if the person is, or is acting as, a person referred to in paragraph 24(1)(b)—to the foreign general insurer concerned; or
(iii)
if the person is, or is acting as, a person referred to in paragraph 24(1)(c)—to the authorised NOHC; and
(b)
to be published in the Gazette .

(6) Part VI applies to a disqualification under this section or to a refusal to revoke such a disqualification.
4 Subsections 26(3) to (6)

Repeal the subsections, substitute:

(3) If a person applies for a determination under this section, APRA must:

(a)
either make, or refuse to make, the determination; and

(b)
in the case of a refusal, give the person written notice of the refusal.

(4) APRA may do any of the following:

(a)
when making a determination under subsection (1), specify in the determination conditions to which the determination is to be subject;

(b)
at any later time while a determination under subsection (1) is in force, make a further determination specifying conditions or additional conditions to which the determination under subsection (1) is to be subject;

(c)
at any time make a determination varying or revoking conditions that have been specified under paragraph (a) or (b).

(5) A determination takes effect on the day on which it is made.
(6) APRA must, as soon as practicable after a determination is made, give written notice of the making of the determination, and a copy of the determination, to the person concerned and to any affected general insurer or authorised NOHC.
(7) A notice of a refusal to make a determination, or a notice of the making of a determination that specifies or varies conditions, must state the reasons for the refusal or for the specifying or variation of the conditions, as the case may be.
(8) APRA may revoke a determination under this section by giving written notice to the person concerned and must give a copy of the notice to any affected general insurer or authorised NOHC.
(9) Part VI applies to a refusal of APRA to make a determination under this section, to a determination under this section that specifies conditions, to a determination under this section that varies conditions in a way that is more onerous on the person concerned or to the revocation of a determination under this section.
5 Subsection 32(3A)

Omit "proposed by a general insurer, authorised NOHC or subsidiary of a general insurer", substitute "proposed by, or agreed to with, a general insurer, an authorised NOHC or a subsidiary of a general insurer or authorised NOHC".

6 After subsection 32(3C)

Insert:

(3CA) APRA may vary or revoke a modification of a prudential standard and, if it revokes a modification, it may make under subsection (3A) a further modification of the standard in substitution for the previous modification. APRA must give written notice of a variation or revocation to the general insurer, authorised NOHC or subsidiary concerned.
7 At the end of subsection 32(3E)

Add "or varying a modification under subsection (3CA)".

8 After subsection 32(4)

Insert:

(4A) A modification, or a variation of a modification, takes effect on the day on which the modification or variation is made or such later day as is specified in the instrument effecting the modification or variation.
9 Subsection 33(1)

After "making", insert ", modifying".

10 Paragraph 42(1)(a)

Omit "of the appointment", substitute "that the person was required to perform".

11 Paragraph 43(a)

Repeal the paragraph.

12 Subsection 49N(1)

Repeal the subsection, substitute:

(1) APRA may give a written direction to a general insurer to provide, or further provide, in its accounts for the purposes of this Act (including the prudential standards):

(a)
a specified amount; or

(b)
an amount determined in a specified way;

as the value of a specified asset of the insurer.

13 After subsection 49N(4)

Add:

(4A) A direction ceases to have effect on the commencement of the winding up of the general insurer concerned.
14 Subsection 63(12)

Omit all the words after "employee", substitute:

of:

(a)
an entity of any kind carrying on (whether in Australia or elsewhere) insurance business or life insurance business; or

(b)
if an entity referred to in paragraph (a) is a body corporate—a body corporate that is related to it.

15 After subsection 63(12)

Insert:

(12A) The question whether 2 bodies corporate are related to each other for the purposes of paragraph (12)(b) is to be determined in the same way as that question is determined for the purposes of the Corporations Act 2001 .
16 At the end of section 117

Add:

(3) If:

(a)
written notice has been given to APRA of an address for service in Australia for a foreign general insurer; and

(b)
a body corporate that is a subsidiary of the foreign general insurer is not incorporated in Australia; and

(c)
no written notice has been given to APRA of an address for service in Australia for the subsidiary;

the address for service in Australia for the foreign general insurer is taken, from the time when the notice referred to in paragraph (a) was or is given, to have been, or to be, the address for service in Australia for the subsidiary for the purposes of this Act.

17 After subsection 118(4)

Insert:

(4A) If:

(a)
a foreign general insurer has given written notice under subsection (4) of the appointment of an agent of the foreign general insurer and the notice specifies the name and place of residence of the agent; and

(b)
a body corporate that is a subsidiary of the foreign general insurer is not incorporated in Australia; and

(c)
no written notice has been given to APRA of the appointment of an agent of the subsidiary;

the agent specified in the notice referred to in paragraph (a) is taken, from the time when that notice was or is given, to have been, or to be, the agent of the subsidiary for the purposes of this Act and to have been, or to have, the place of residence specified in that notice.

General Insurance Reform Act 2001

18 Paragraph (a) of subitem 5(2) of Schedule 2

Omit "old Act", substitute "new Act".


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