Draft Prude ntial Standards Andr e w Boal, Chair of the ac tic e - - PowerPoint PPT Presentation

Draft Prude ntial Standards

Andr e w Boal, Chair

• f the

Supe r annuation Pr ac tic e Committe e

• Must se t a sho rtfa ll limit b a se d o n ve ste d b e ne fits
• E

xpe c te d to b e a d d re sse d within 1 ye a r - o r ne xt va lua tio n if so o ne r

• Witho ut ne e d fo r imme d ia te a c tio n (o the rwise

“inte rim” va lua tio n, re po rt within 3 mo nths, a sse ts vs sho rtfa ll limit, re c o mme nd e d a c tio ns/ c o ntrib utio ns within 15 d a ys)

• APRA c a n d ire c t lic e nse e to a ppo int a n a c tua ry o r

c o nd uc t va lua tio n o r re q ue st re po rt

• 6 mo nth time fra me fo r re g ula r va lua tio ns
• ORF

R e xc lud e d fro m a sse ts

• 3 ye a rs pro je c tio ns o n re a so na b le e xpe c ta tio ns

De fine d Be ne fit Matte rs (SPS 160)

• If unsa tisfa c to ry (o r a b o ut to b e c o me – 3 ye a rs? ):
• Ac tua ry must pre pa re a sta te me nt to lic e nse e within 15

b usine ss da ys with re c o mme nde d a c tio ns/ c o ntrib utio ns

• Re sto re sa tisfa c to ry po sitio n within “re a so na b le ”

time fra me (3 ye a rs ma ximum)

• L

ic e nse e must se t o ut re sto ra tio n pla n within 3 mo nths

• Inc luding like liho o d tha t c o ntrib utio ns will b e pa id
• Pro vide c o py to APRA within 15 b usine ss da ys
• Ac tua ria l ma na g e me nt if sho rtfa ll limit b re a c he d
• APRA ma y re q uire re g ula r re po rts, re vie w inve stme nt

stra te g y o r va ry the pe rio d o f the re sto ra tio n pla n

De fine d Be ne fit Matte rs (SPS 160)

Se lf insura nc e :

• Annua l a tte sta tio n tha t se lf insura nc e is in

me mb e rs b e st inte re st

• Ac tua ria l a sse ssme nt o f a de q ua c y o f re se rve

a t le a st e ve ry thre e ye a rs

• De ve lo p a c o nting e nc y pla n

De fine d Be ne fit Matte rs (SPS 160)

Re q uire me nts:

• Ne e d to ha ve “insura nc e ma na g e me nt fra me wo rk”
• Co sts/ pre miums, und e rwriting , c la ims
• Re vie w pro c e ss
• F
• rmula te a nd g ive e ffe c t to se le c tio n pro c e ss
• Due d ilig e nc e o f se le c te d insure rs
• Insura nc e po lic ie s to me e t minimum sta nd a rd s
• Rule s fo r mo nito ring insura nc e re la tio nships
• T

ra nsitio n fo r “no n pe rmitte d ” insura nc e pro d uc ts

Insuranc e in Supe r (SPS 250)

Re spo nsib le pe rso ns:

• Inc lude s a d ire c to r, se nio r ma na g e r a nd se c re ta ry, plus

the a ppro ve d a ud ito r a nd the a c tua ry

• Crite ria fo r the a c tua ry inc lud e s:
• Co mpe te nc e , c ha ra c te r, d ilig e nc e , e xpe rie nc e ,

ho ne sty, inte g rity a nd jud g e me nt – a ll o the r c rite ria

• Appro pria te fo rma l q ua lific a tio ns (F

IAA o r Ac c re d ite d )

• Minimum five ye a rs re le va nt e xpe rie nc e in supe r
• No c o nflic t o f inte re st, o r the c o nflic t will no t c re a te

a ma te ria l risk tha t the pe rso n will fa il to pe rfo rm pro pe rly the ir d utie s o f the po sitio n

F it and Prope r (SPS 520)

Re q uire me nts fo r the a c tua ry:

• Id e ntify a ll po te ntia l c o nflic ts
• Circ umsta nc e s tha t mig ht g ive rise to a c o nflic t
• Und e rsta nd the c o nflic t ma na g e me nt fra me wo rk
• Ob lig a tio ns to the truste e b o a rd
• Disc lo se a ll re le va nt dutie s a nd re le va nt inte re sts, a nd
• K

e e p the info rma tio n up-to -da te

• T

ruste e Bo a rd must:

• Avo id c o nflic ts whe re re q uire d, o r
• Ma na g e c o nflic ts to g ive prio rity to b e ne fic ia rie s

Conflic ts of Inte re st (SPS 521)

• Risk Ma na g e me nt F

ra me wo rk

• Co ve ring a ll ma te ria l risks, risk a ppe tite , risk to le ra nc e
• Ope ra tio na l Risk F

ina nc ia l Re q uire me nt (ORF R)

• T

a rg e t le ve l a nd to le ra nc e limit

• Pro c e ss is impo rta nt (pro je c tio ns & stre ss te sting )
• Re ple nishme nt pla n o ve r re a so na b le pe rio d
• Audit a de q ua c y a nd e ffe c tive ne ss (e xte rna l e xpe rt)
• Inve stme nt Go ve rna nc e F

ra me wo rk

• Co mpre he nsive stre ss te sting inc luding liq uidity
• 22 + fra me wo rks, pla ns, po lic ie s, pro c e dure s, stra te g ie s,

c ha rte rs, de le g a tio ns, a ppo intme nts …

Risk Manage me nt (SPS220) & ORF R (SPS114) & more