Six new prudential standards have been finalised by APRA to enforce higher performance requirements in the post-HIH era. And there’s a seventh prudential standard thrown into the mix to sweeten APRA’s job in putting the new rules in place.

APRA Chief Executive Graeme Thompson, who announced the finalised prudential standards for general insurance companies operating in Australia, said some minor changes have been made to the prudential standards since their unveiling in November to “improve their presentation and legal effectiveness”.

The six standards – Capital Adequacy, Assets in Australia, Liability Valuation, Risk Management, Reinsurance, Transfer and Amalgamation of Insurance Business – will be implemented in July. 

The additional prudential standard, effective immediately, enables APRA to immediately approve the appointment of auditors and actuaries until the permanent standards come into effect with the enactment of the Insurance Act amendments on July 1.

Mr Thompson said this new standard will not put any further pressure on insurers, and is designed to “simply assist in facilitating the transition to the new regime”. 

The finalisation of the standards is a big moment for APRA, which has moved swiftly and with considerable public fanfare to introduce the new standards. The regulator has faced strident criticism from just about everyone about its seemingly laid-back attitude to its oversight of HIH prior to the company’s collapse last March.