PwC Insurance Facts and Figures 2011 - PricewaterhouseCoopers

Key development
Changes to General Insurance
Prudential reporting
APRA’s expectations regarding
post reporting date events
Summary of issue
Following a consultation process with the industry, APRA
released amendments to a number of the Prudential
Standards to align prudential reporting more closely with
statutory reporting for general insurers, while maintaining
the current capital framework. The changes are intended to
deliver three important benefits:
• simplify reporting by general insurers to APRA;
• provide APRA with more effective information for
assessing insurer performance; and
• enhance the dialogue between APRA and individual
insurers on their performance.
The changes came into effect for reporting periods after
1 July 2010.
In early 2011 APRA issued two guidance letters to clarify
their expectations for the impact of post reporting date
events on the calculation of premium liabilities for
prudential reporting purposes.
It is APRA’s expectation that an insurer includes the impact
of relevant post reporting date information on its solvency
position in quarterly and annual reporting to APRA to the
extent it is practical to do so.
In calculating premium liabilities a general insurer must
make allowance in their Quarterly APRA return for all post
reporting date events up to submission of the return. For
the Annual APRA return the Prudential Standards require
insurers to include updated information on only those
events that were included in the Quarterly APRA return.
New events subsequent to the submission of the Quarterly
APRA return are not required to be included in the Annual
APRA return calculations.
Insurance Facts and Figures 2011 43