The Australian Prudential Regulation Authority (APRA) expects insurers to include the impact of events like the Queensland floods in their quarterly and annual regulatory reports.

The regulator has written to insurers saying quarterly returns should include any adjustment to premium liabilities provided by actuaries for post-reporting day events.

It says insurers’ annual returns must provide more detailed information on events such as the floods.   

“It is critical that APRA is able to accurately assess an insurer’s solvency position at any point in time,” it says.

“It is APRA’s expectation that an insurer includes the impact of relevant post-reporting date information on its solvency position in quarterly and annual reporting.”

APRA is looking for information that may affect premiums and liabilities, as well as any impact to an insurer’s capital base due to a post-reporting date event.

“Such impacts to the capital base may include the need to pay reinstatement premiums for relevant reinsurance arrangements,” the letter tells insurers.

“Where a significant event occurs a few days or weeks after the reporting date it should be practicable to make some allowance for it in reporting to APRA.”