Regulation Impact Statement – Australian Prudential Regulation Authority
A 2016 thematic review conducted by the Australian Securities and Investment Commission (ASIC) identified the need for better quality and more consistent and transparent data on life insurance claims and disputes. Previous published data gaps made it difficult for consumers to compare and assess declined claim rates and performance across providers, while insurers themselves were hampered in their ability to assess and compare the performance and outcomes of their own claims handling procedures.
Consumers will soon have access to data on life insurance claims and disputes following the release of a new reporting standard by the Australian Prudential Regulation Authority (APRA). The Financial Sector (Collection of Data) (reporting standard) determination No. 42 of 2018 was registered on the Federal Register of Legislative Instruments on 29 October 2018, and makes it mandatory for life insurers to report data on claims and disputes. Establishing this standard will support regular publication of comparable data for use by consumers and industry alike.
APRA, in consultation with ASIC, developed this proposal and the preferred option while conducting public and targeted formal consultations and industry engagement during May 2017 through to July 2018. A standard form Regulation Impact Statement (RIS) prepared by APRA has been assessed as consistent with best practice by the Office of Best Practice Regulation (OBPR). APRA has estimated average annual regulatory costs of $1.2 million for business, in accordance with the Government’s Regulatory Burden measurement framework.