Underwriting agencies have been warned that the July 1 CPS 230 Operational Risk Management deadline poses a burden and “risks to shoulder they can’t possibly manage”. 

Insurtech Curium, which specialises in compliance, says large insurers are passing the burden onto smaller agencies through “ruthless contracts and excessive compliance demands”. 

Its CEO Tetiana George says if major insurers fail to comply with CPS 230, the “fallout won’t just hit them, it will cascade down to underwriting agencies and suppliers, creating serious business risks for everyone in the chain”. 

Agencies are being asked to take on obligations that they are in many instances ill-equipped to deliver, she says, and are being “forced to shoulder the compliance load”. 

“The reality is agencies don’t have the resources to manage compliance the same way big insurers do. Insurers need to understand that simply pushing risk onto agencies doesn’t eliminate it, it amplifies it. It’s a warning for agencies to take control of their risk and compliance strategy,” Ms George said.  

“There’s a power imbalance where agencies and smaller suppliers are being strong-armed into signing invasive contracts and unlimited liability clauses and not because APRA requires it, but because insurers want to protect themselves.”  

While regulated insurers face direct regulatory scrutiny, Ms George says it is smaller distribution partners and intermediaries feeling the pressure the most. 

Curium says embedding technology to help with compliance ensures risks are identified and mitigated instantly, creating a sustainable, proactive framework that prevents issues before they escalate.