Insurance companies need to appoint board directors with the “right qualifications” to prevent similar misconduct to that uncovered by the Hayne royal commission, according to the Actuaries Institute.

Board recruitment models should recognise the special needs of insurance companies and chairs should have CEO experience.

Former Actuaries Institute President Barry Rafe and ex-Australian Prudential Regulation Authority deputy chairman Ian Laughlin have prepared a toolkit containing a checklist of key criteria to consider when scouting for board directors and chairmen.

Using the checklist would likely lead to a board with at least three directors with deep operational experience earned working in the financial services sector.

Appointees with “golden” or unblemished careers may not be as valuable to the board as those who have survived an insolvency or major crisis.

“Boards are obliged to act in the best interests of the company but in financial services there are other legal and moral obligations to protect the interests of customers,” Mr Laughlin said.

“The skills and capabilities of the board and individual directors can have profound implications for conduct and culture.”

Click here for the checklist.