{"id":"F2024L00195","name":"Life Insurance Regulations 2024","slug":"life-insurance-regulations-2024","collection":"legislative_instrument","jurisdiction":"commonwealth","status":"in_force","isInForce":true,"actNumber":null,"makingDate":null,"administeringDepartment":null,"currentVersion":{"id":442280,"registerId":"F2024L00195-fast-fetch-1775957335817","compilationNumber":null,"startDate":"2026-04-12","status":"InForce","reasons":null,"registeredAt":null},"sections":[{"sectionNumber":"1","sectionType":"section","heading":"Life Insurance Regulations 2024","content":"---\nmeta-content-style-type: text/css\nmeta-content-type: application/xhtml+xml; charset=utf-8\n---\n\n?xml version=\"1.0\" encoding=\"utf-8\" standalone=\"no\"?>\n\n![Commonwealth Coat of Arms of Australia](image.001.jpeg)\n\n \n\nLife Insurance Regulations 2024\n\nI, General the Honourable David Hurley AC DSC (Retd), Governor‑General of the Commonwealth of Australia, acting with the advice of the Federal Executive Council, make the following regulations.\n\nDated     19 February 2024\n\nDavid Hurley\n\nGovernor‑General\n\nBy His Excellency’s Command\n\nStephen Jones\n\nAssistant Treasurer  Minister for Financial Services\n\n \n\n \n\n \n\n \n\n \n\n \n\nContents\n\nPart 1—Preliminary\n\n1 Name\n\n2 Commencement\n\n3 Authority\n\n4 Definitions\n\nPart 2—Explanation of key concepts\n\n5 Life policy—minimum terms of annuities\n\nPart 2B—Special provisions relating to Australian branches of foreign life insurance companies\n\n6 Eligible foreign life insurance company\n\nPart 9—Transfers and amalgamations of life insurance business\n\n7 Application for confirmation of scheme\n\n8 Documents to be given to APRA\n\nPart 10—Provisions relating to policies\n\n9 Interest on overdue premiums—prescribed terms\n\n10 Unclaimed money—interest payable\n\n11 Calculation of net claim value of policy\n\nPart 12—Application, transitional and saving provisions\n\nDivision 1—Provisions relating to this instrument as originally made\n\n12 Application of section 7\n\n13 Application of section 8\n\nPart 13—Dictionary\n\n14 Definition of approved body\n\n15 Definition of derivative\n\n16 Definition of superannuation policy\n\nSchedule 1—Approved bodies\n\n1 Approved bodies\n\nPart 1—Preliminary\n\n \n\n1  Name\n\n  This instrument is the Life Insurance Regulations 2024.\n\n2  Commencement\n\n (1) Each provision of this instrument specified in column 1 of the table commences, or is taken to have commenced, in accordance with column 2 of the table. Any other statement in column 2 has effect according to its terms.\n\n \n\n- Commencement information\n- Column 1 Column 2 Column 3\n- Provisions Commencement Date/Details\n- 1. The whole of this instrument 1 March 2024. 1 March 2024\n\n\nNote: This table relates only to the provisions of this instrument as originally made. It will not be amended to deal with any later amendments of this instrument.\n\n (2) Any information in column 3 of the table is not part of this instrument. Information may be inserted in this column, or information in it may be edited, in any published version of this instrument.\n\n3  Authority\n\n  This instrument is made under the Life Insurance Act 1995.\n\n4  Definitions\n\nNote: A number of expressions used in this instrument are defined in the Act, including the following:\n\n(a) Court;\n\n(b) policy.\n\n  In this instrument:\n\nAct means the Life Insurance Act 1995.\n\nallocated annuity policy means a policy that provides for an annuity:\n\n (a) that is paid, within a specified range of minimum and maximum payments, from an identifiable lump sum; or\n\n (b) that arises under a contract that meets the standards of subregulation 1.05(4) of the Superannuation Industry (Supervision) Regulations 1994.\n\ncertified copy of a document means a copy of the document that has been certified in writing, by a person prescribed for the purposes of paragraph 8(b) of the Statutory Declarations Act 1959, to be a true copy of the document.\n\ndeferred annuity policy means a policy that provides for an annuity that is not presently payable.\n\nimmediate annuity policy means a policy that provides for an annuity that is presently payable.\n\nPart 2—Explanation of key concepts\n\n \n\n5  Life policy—minimum terms of annuities\n\n  For the purposes of paragraph 9(1)(d) of the Act, the term of 10 years is prescribed.\n\nPart 2B—Special provisions relating to Australian branches of foreign life insurance companies\n\n \n\n6  Eligible foreign life insurance company\n\n (1) For the purposes of paragraph 16ZD(1)(e) of the Act, the following condition is specified: the condition that:\n\n (a) the body corporate:\n\n (i) is authorised to carry on life insurance business in China; and\n\n (ii) is incorporated in China; or\n\n (b) the body corporate:\n\n (i) is authorised to carry on life insurance business in Japan; and\n\n (ii) is incorporated in Japan; or\n\n (c) the body corporate:\n\n (i) is authorised to carry on life insurance business in New Zealand; and\n\n (ii) is incorporated in New Zealand; or\n\n (d) the body corporate:\n\n (i) is authorised to carry on life insurance business in the Republic of Korea; and\n\n (ii) is incorporated in the Republic of Korea; or\n\n (e) the body corporate:\n\n (i) is authorised to carry on life insurance business in the United States of America; and\n\n (ii) is incorporated in the United States of America.\n\n (2) In paragraph (1)(a) of this section, a reference to China does not include a reference to the following members of the World Trade Organization:\n\n (a) Hong Kong, China;\n\n (b) Macao, China;\n\n (c) Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu.\n\nPart 9—Transfers and amalgamations of life insurance business\n\n \n\n7  Application for confirmation of scheme\n\n (1) For the purposes of paragraph 191(2)(e) of the Act, the following requirement is prescribed: the application must not be made earlier than 15 days after the first day on which an approved summary of the scheme has been given to every affected policy holder in accordance with paragraph 191(2)(c) of the Act.\n\n (2) This section does not apply if, under subsection 191(5) of the Act, the Court dispenses with the need for compliance with paragraph 191(2)(c) of the Act in relation to the scheme.\n\n8  Documents to be given to APRA\n\n (1) For the purposes of subsection 197(1) of the Act, if any part of the life insurance business carried on by a life company is transferred to, or amalgamated with the life insurance business of, another company, the latter company must give APRA the following documents:\n\n (a) a statement of the nature and terms of the transfer or amalgamation;\n\n (b) a certified copy of each of the following documents:\n\n (i) the scheme providing for the transfer or amalgamation;\n\n (ii) each actuarial report or other report (if any) on which the scheme, and the agreement or deed by which the transfer or amalgamation is carried out, are founded;\n\n (iii) the agreement or deed by which the transfer or amalgamation is carried out;\n\n (iv) the Court order confirming the scheme;\n\n (v) a statement of the assets and liabilities of each company affected by the scheme (within the meaning of section 189 of the Act);\n\n (c) a statutory declaration by the principal executive officer of the latter company:\n\n (i) setting out, in relation to the transfer or amalgamation, each payment made; and\n\n (ii) setting out, in relation to the transfer or amalgamation, a reasonable estimate of each payment to be made in the future; and\n\n (iii) stating that he or she reasonably believes that no other payment has been made, or will be made, in relation to the transfer or amalgamation, by, or with the knowledge of, a party to the agreement or deed by which the transfer or amalgamation is carried out.\n\n (2) For the purposes of subsection 197(2) of the Act, and subject to subsection (3) of this section, the documents must be given to APRA within 30 days after the transfer or amalgamation is completed.\n\n (3) A company may apply, in writing, to APRA, before the end of the 30 days referred in subsection (2), for an extension of the time in which to give the documents to APRA.\n\n (4) If APRA receives an application under subsection (3) from a company for an extension of time in which to give documents to APRA, APRA must, within 14 days after receiving the application:\n\n (a) either:\n\n (i) if APRA believes that, when the application was made, it was not reasonably possible for the company to give the documents to APRA within the 30 days referred to in subsection (2)—give the company an extension of time of no longer than 30 days; or\n\n (ii) otherwise—refuse the application; and\n\n (b) give the company written notice of APRA’s decision on the application.\n\n (5) For the purposes of subparagraph (zt)(ii) of the definition of reviewable decision in subsection 236(1) of the Act, a decision to refuse an application under subparagraph (4)(a)(ii) of this section is prescribed.\n\nPart 10—Provisions relating to policies\n\n \n\n9  Interest on overdue premiums—prescribed terms\n\n (1) For the purposes of subsection 210(3) of the Act, the following term is prescribed: the term that the rate of interest that may be charged on an overdue premium on a day is the interest rate worked out using the following formula:\n\n![Start formula 10 year Commonwealth Government bond yield plus 3 per cent end formula](image.002.png)\n\n (2) The 10 year Commonwealth Government bond yield is the mean of the 10 year Commonwealth Government bond yields (as shown in figures published by the Reserve Bank of Australia) at the end of each of the last 6 successive half financial years ending before that day, expressed as a percentage.\n\n (3) If the mean worked out under subsection (2) is not a multiple of 0.25%, round it down to the nearest multiple of 0.25%.\n\n10  Unclaimed money—interest payable\n\n (1) This section applies if:\n\n (a) a life company paid unclaimed money to the Commonwealth under section 216 of the Act; and\n\n (b) some or all of the unclaimed money is paid to the life company under subsection 216(7) of the Act.\n\n (2) For the purposes of paragraph 216(7A)(a) of the Act, this section sets out how to work out the amount of interest that is to be paid in relation to the payment made to the life company.\n\n (3) If the life company paid the unclaimed money to the Commonwealth in more than one payment, work out the interest separately for each payment to the Commonwealth.\n\n (4) To avoid doubt, if the Commonwealth pays the unclaimed money to the life company in more than one payment, work out the interest separately for each payment to the life company.\n\nExample: A life company pays $100 of unclaimed money to the Commonwealth on day 1, and $200 on day 2. On day 3, the Minister causes $175 of unclaimed money to be paid to the life company, consisting of:\n\n(a) the $100 of unclaimed money paid to the Commonwealth on day 1; and\n\n(b) $75 of the unclaimed money paid to the Commonwealth on day 2.\n\n Under subsection (3), interest for the $100 and the $75 are worked out separately.\n\n On day 4, the Minister causes $125 of unclaimed money to be paid to the life company, being the remainder of the unclaimed money paid to the Commonwealth on day 2. Under subsection (4), interest for the $125 is worked out separately from the interest for the $75 mentioned in paragraph (b) of this example.\n\nMeaning of interest period\n\n (5) For the purposes of this section, the interest period is the period that:\n\n (a) starts on the later of:\n\n (i) 1 July 2013; and\n\n (ii) the day when the life company paid the unclaimed money to the Commonwealth; and\n\n (b) ends on the 14th day after the day on which the Minister causes the unclaimed money to be paid to the life company.\n\nInterest\n\n (6) Work out the amount of interest by adding together the interest for each financial year that occurs wholly or partly during the interest period.\n\n (7) Work out the interest for each financial year using the following formula:\n\n![Start formula start fraction Amount times Days interest payable times Interest rate for the financial year over Number of days in the financial year end fraction end formula](image.003.png)\n\nwhere:\n\namount means the amount of the unclaimed money paid to the life company plus the interest (if any) worked out for each earlier financial year that occurs wholly or partly during the interest period.\n\ndays interest payable means the number of days in the financial year that occur during the interest period.\n\ninterest rate has the meaning given by subsection (9).\n\n (8) If the amount worked out using the formula in subsection (7) is not a whole number of dollars and cents, round the amount down to the nearest whole number of dollars and cents.\n\nMeaning of interest rate\n\n (9) For the purposes of subsection (7), the interest rate for a financial year is the percentage worked out using the following formula:\n\n![Start formula start fraction Index number for the latest March CPI quarter minus Index number for the second latest March CPI quarter over Index number for the second latest March CPI quarter end fraction times 100% end formula](image.004.png)\n\nwhere:\n\nindex number for a March CPI quarter means the All Groups Consumer Price Index number (being the weighted average of the 8 capital cities) first published by the Australian Statistician for the quarter.\n\nlatest March CPI quarter means the latest March CPI quarter for which the index number is published before the start of the financial year.\n\nMarch CPI quarter means a period of 3 months ending on 31 March.\n\nsecond latest March CPI quarter means the second latest March CPI quarter for which the index number is published before the start of the financial year.\n\n (10) If the interest rate is not a multiple of 0.0001%, round it up to the nearest multiple of 0.0001%.\n\n (11) If the interest rate is less than 0%, round it up to 0%.\n\n11  Calculation of net claim value of policy\n\n (1) For the purposes of subsection 223(2) of the Act, this section sets out how to calculate the net claim value of a policy at a particular time.\n\n (2) The net claim value is the amount worked out using the following formula:\n\n![Start formula Amount payable in respect of claim minus Debts end formula](image.005.png)\n\nwhere:\n\namount payable in respect of claim means:\n\n (a) if, at that particular time:\n\n (i) the policy has matured; or\n\n (ii) the person whose life is insured under the policy has died;\n\n  the amount payable on a claim arising under the policy in respect of that maturing or death; or\n\n (b) otherwise—the amount that, were the policy to be voluntarily terminated at that particular time, would be payable on a claim arising under the policy in respect of that termination.\n\ndebts means the total amount of any debts that, at that particular time, are:\n\n (a) owed to the relevant life company under the policy; or\n\n (b) secured by the policy.\n\nPart 12—Application, transitional and saving provisions\n\nDivision 1—Provisions relating to this instrument as originally made\n\n12  Application of section 7\n\n  Section 7 applies in relation to an application for confirmation of a scheme made on or after the commencement of this section.\n\n13  Application of section 8\n\n (1) Despite the repeal of regulation 9.04 of the Life Insurance Regulations 1995 by the Treasury Laws Amendment (Insurance) Regulations 2024, that regulation continues to apply, on and after the commencement of this section, in relation to a transfer or amalgamation that is completed before that commencement.\n\n (2) Section 8 of this instrument applies in relation to a transfer or amalgamation that is completed on or after the commencement of this section.\n\nPart 13—Dictionary\n\n \n\n14  Definition of approved body\n\n  For the purposes of the definition of approved body in Schedule 1 to the Act, approved body has the meaning given by Schedule 1 to this instrument.\n\n15  Definition of derivative\n\n  For the purposes of paragraph (b) of the definition of derivative in Schedule 1 to the Act, something is prescribed if any of paragraphs 6(2)(a) to (h) of the Payment Systems and Netting Regulations 2001 apply to an obligation under that thing.\n\nNote: Paragraphs 6(2)(a) to (h) of the Payment Systems and Netting Regulations 2001 identifies obligations that are not eligible obligations in relation to a close‑out netting contract. These include obligations under credit facilities, reciprocal purchase agreements (otherwise known as repurchase agreements), sell‑buyback arrangements, securities loan arrangements, contracts of insurance and managed investment schemes.\n\n16  Definition of superannuation policy\n\n  For the purposes of paragraph (b) of the definition of superannuation policy in Schedule 1 to the Act, the following kind of life policy is prescribed: a life policy that:\n\n (a) is an allocated annuity policy, a deferred annuity policy or an immediate annuity policy; and\n\n (b) is maintained for the purposes of superannuation or retirement.\n\nSchedule 1—Approved bodies\n\nNote: See section 14.\n\n \n\n \n\n1  Approved bodies\n\n  Each exchange, market, clearing house, body or entity listed in the following table is an approved body.\n\n \n\n- Approved bodies\n- Item Exchange, market, clearing house, body or entity\n- 1 AB NASDAQ Vilnius\n- 2 ASX24\n- 3 ASX Clear (Futures) Pty Limited\n- 4 ASX Clear Pty Limited\n- 5 ASX operated by ASX Limited\n- 6 ASX Settlement Pty Limited\n- 7 Athens Exchange\n- 8 Athens Exchange Clearing House\n- 9 Austraclear Limited\n- 10 Australian Energy Market Operator Limited\n- 11 Bloomberg SEF LLC\n- 12 Bloomberg Tradebook Singapore Pte Ltd.\n- 13 Bloomberg Trading Facility B.V.\n- 14 Bloomberg Trading Facility Limited\n- 15 BME Clearing\n- 16 Bombay Stock Exchange\n- 17 Borsa Istanbul\n- 18 Borsa Istanbul Futures & Options Market\n- 19 Boston Options Exchange\n- 20 Bourse de Montréal\n- 21 BrokerTec Europe Limited\n- 22 B3 S.A.\n- 23 Budapesti Értéktözsde\n- 24 Bursa Malaysia Derivatives\n- 25 BZX Options Exchange\n- 26 Cantor Clearinghouse, L.P.\n- 27 Cassa di Compensazione e Garanzia S.p.A\n- 28 Cboe Exchange, Inc\n- 29 Cboe Futures Exchange\n- 30 Cboe FX Markets, LLC\n- 31 CBOT\n- 32 CCP Austria Abwicklungsstelle für Börsengeschäfte GmbH\n- 33 CDSClear operated by LCH SA\n- 34 CEGH Gas Exchange of Vienna Stock Exchange\n- 35 Central Depository (Pte) Limited\n- 36 Chicago Board Options Exchange\n- 37 Chicago Mercantile Exchange Inc\n- 38 China Financial Futures Exchange\n- 39 CME Clearing\n- 40 CME operated by Chicago Mercantile Exchange Inc.\n- 41 COMEX operated by Commodity Exchange, Inc.\n- 42 CommodityClear operated by LCH SA\n- 43 Dalian Commodity Exchange\n- 44 Dubai Gold & Commodities Exchange\n- 45 Dubai Mercantile Exchange\n- 46 Electronic Liquidity Exchange operated by ELX Futures LP\n- 47 EPEX SPOT SE\n- 48 Eurex Clearing AG\n- 49 Eurex Deutschland\n- 50 EuroGCplus operated by LCH SA\n- 51 Euronext Amsterdam Derivatives Regulated Market operated by Euronext Amsterdam NV\n- 52 Euronext Amsterdam Securities Regulated Market operated by Euronext Amsterdam NV\n- 53 Euronext Brussels Derivatives Regulated Market operated by Euronext Brussels SA/NV\n- 54 Euronext Brussels Securities Regulated Market operated by Euronext Brussels SA/NV\n- 55 Euronext Lisbon Derivatives Regulated Market operated by Euronext Lisbon – Sociedade Gestora de Mercados Regulamentados, S.A.\n- 56 Euronext Lisbon Securities Regulated Market operated by Euronext Lisbon – Sociedade Gestora de Mercados Regulamentados, S.A.\n- 57 Euronext London Securities Regulated Market operated by Euronext London Limited\n- 58 Euronext Paris Derivatives Regulated Market by Euronext Paris S.A.\n- 59 Euronext Paris MATIF\n- 60 Euronext Paris MONEP\n- 61 Euronext Paris Securities Regulated Market by Euronext Paris S.A.\n- 62 European Central Counterparty N.V.\n- 63 European Climate Exchange\n- 64 European Commodity Clearing AG\n- 65 European Energy Exchange\n- 66 Financial & Risk Transaction Services Ireland Limited\n- 67 ForexClear operated by LCH Ltd\n- 68 HKFE Clearing Corporation Limited\n- 69 Hong Kong Exchange and Clearing Ltd\n- 70 Hong Kong Futures Exchange Limited\n- 71 Hong Kong Securities Clearing Company Limited\n- 72 Hungarian Power Exchange operated by HUPX Ltd\n- 73 ICAP Brokers Pty Ltd\n- 74 ICAP Securities and Derivatives Exchange\n- 75 ICE Clear Credit LLC\n- 76 ICE Clear Europe Limited\n- 77 ICE Clear Netherlands B.V.\n- 78 ICE Clear Singapore\n- 79 ICE Clear US, Inc\n- 80 ICE Endex Markets B.V.\n- 81 ICE Futures Canada, Inc\n- 82 ICE Futures Europe\n- 83 ICE Futures U.S., Inc\n- 84 International Securities Exchange\n- 85 Italian Derivatives Market\n- 86 Italian Stock Exchange operated by Borsa Italiana S.p.A\n- 87 Jakarta Futures Exchange\n- 88 Japan Securities Clearing Corporation\n- 89 Johannesburg Stock Exchange\n- 90 JSE Commodity Derivatives Market\n- 91 KDPW_CCP S.A.\n- 92 Keler CCP\n- 93 KOSPI Market operated by the Korea Exchange\n- 94 LME Clear Limited\n- 95 MarketAxess Europe Limited\n- 96 MarketAxess Singapore Pte Limited\n- 97 Mercado Español de Futuros Financieros\n- 98 Mexican Derivatives Exchange\n- 99 Minneapolis Grain Exchange, Inc.\n- 100 Montréal Climate Exchange\n- 101 NASDAQ BX, Inc.\n- 102 NASDAQ Commodities operated by NASDAQ Oslo ASA\n- 103 NASDAQ Copenhagen A/S\n- 104 NASDAQ Derivatives Markets operated by NASDAQ Stockholm AB\n- 105 NASDAQ Futures operated by NASDAQ Futures, Inc.\n- 106 NASDAQ Helsinki Ltd\n- 107 NASDAQ Iceland hf.\n- 108 NASDAQ NLX Ltd\n- 109 NASDAQ OMX Armenia\n- 110 NASDAQ PHLX LLC\n- 111 NASDAQ PSX operated by NASDAQ PHLX LLC\n- 112 NASDAQ Riga, AS\n- 113 NASDAQ Stockholm AB\n- 114 NASDAQ Tallinn AS\n- 115 National Stock Exchange of India Ltd\n- 116 New York Stock Exchange operated by the New York Stock Exchange LLC\n- 117 Nodal Clear, LLC\n- 118 Nodal Exchange, LLC\n- 119 NYMEX Emissions operated by New York Mercantile Exchange, Inc.\n- 120 NYMEX operated by New York Mercantile Exchange, Inc.\n- 121 NYSE Amex Option operated by NYSE MKT LLC\n- 122 NYSE Arca Equities operated by NYSE Arca Equities, Inc.\n- 123 NYSE Arca Options operated by NYSE Arca Equities, Inc.\n- 124 NYSE MKT operated by NYSE MKT LLC\n- 125 NZX Main Board operated by NZX Limited\n- 126 OMIClear, C.C., S.A.\n- 127 OneChicago LLC\n- 128 Osaka Exchange, Inc.\n- 129 Oslo Bors operated by Oslo Børs ASA\n- 130 OTC Clearing Hong Kong Limited\n- 131 Power Exchange Central Europe, a.s.\n- 132 Powernext SA\n- 133 Refinitiv Transaction Services Limited\n- 134 Refinitiv Transaction Services Pte. Ltd.\n- 135 RepoClear Ltd operated by LCH Ltd\n- 136 RepoClear SA operated by LCH SA\n- 137 Shanghai Futures Exchange\n- 138 Singapore Exchange Derivatives Clearing Limited\n- 139 Singapore Exchange Derivatives Trading Limited\n- 140 Singapore Exchange Securities Trading Limited\n- 141 SIX x‑clear Ltd\n- 142 SwapAgent Limited\n- 143 SwapClear operated by LCH Ltd\n- 144 Taiwan Futures Exchange\n- 145 Tel Aviv Stock Exchange Ltd\n- 146 Thailand Futures Exchange operated by the Thailand Futures Exchange Public Company Limited\n- 147 The derivatives market operated by Moscow Exchange MICEX‑RTS\n- 148 The equity and bond market operated by Moscow Exchange MICEX‑RTS\n- 149 The equity derivatives market operated by the Johannesburg Stock Exchange Limited\n- 150 The London Metal Exchange\n- 151 The London Stock Exchange Derivatives Market\n- 152 The Main Market operated by the London Stock Exchange\n- 153 The Official Market and Second Regulated Market operated by Wiener Börse AG\n- 154 The Options Clearing Corporation\n- 155 The SEHK Options Clearing House Limited\n- 156 The Stock Exchange of Hong Kong Limited\n- 157 Tokyo Commodity Exchange, Inc\n- 158 Tokyo Financial Exchange, Inc\n- 159 Tokyo Stock Exchange, Inc.\n- 160 Toronto Stock Exchange operated by TSX Inc.\n- 161 TradeWeb EU B.V.\n- 162 TradeWeb Europe Limited\n- 163 TriOptima AB\n- 164 Tullett Prebon (Australia) Pty Ltd\n- 165 TW SEF LLC\n- 166 Warsaw Stock Exchange\n- 167 A body or entity that performs clearing house functions, in relation to an approved body (covered by another item of this table) that does not itself perform those functions, in accordance with:(a) the rules of the approved body; or(b) a law of the Commonwealth, a State, a Territory or a foreign country (including a part of a foreign country)\n\n\n \n\n \n","sortOrder":0}],"analysis":{"kimi_summary":{"content_quality":"ok","complexity_score":5,"scope_assessment":{"changed":false,"description":"The legislation appears consistent with its original intent as regulations under the Life Insurance Act 1995. It covers standard regulatory matters: foreign insurer eligibility, business transfers, policy terms, and approved investment bodies. The scope has not expanded beyond typical life insurance regulation."},"complexity_factors":["Multiple mathematical formulas with rounding rules (sections 9, 10, 11)","Extensive cross-referencing to the Life Insurance Act 1995 and other regulations","167-item table of approved bodies in Schedule 1","Nested conditional logic in section 10 (unclaimed money interest calculations) with multiple subsections defining interest periods, financial year calculations, and CPI index references","Specific exclusions for Chinese territories in section 6(2) creating jurisdictional complexity","Transitional provisions in Part 12 preserving old regulations for some transactions while applying new ones to others"],"plain_english_summary":"This legislation sets out detailed rules for how life insurance companies operate in Australia. It covers several key areas:\n\n**What it does:**\n- **Annuity terms**: Sets a minimum 10-year term for certain life insurance annuities (regular payments made to policyholders, usually in retirement).\n- **Foreign companies**: Allows life insurance companies from China, Japan, New Zealand, South Korea, and the USA to operate Australian branches (with specific exclusions for Hong Kong, Macau, and Taiwan).\n- **Business transfers**: Sets rules for when life insurance companies merge or transfer policies to another company, including a 15-day waiting period after notifying affected customers and requirements to tell the prudential regulator (APRA) within 30 days.\n- **Interest on late premiums**: Calculates how much interest insurers can charge when policyholders pay late—using a formula based on 10-year government bond rates plus 3%.\n- **Unclaimed money**: Sets out how to calculate interest owed when the government returns unclaimed insurance money to companies, using inflation (CPI) rates.\n- **Policy valuations**: Defines how to calculate what a policy is worth when claims are made or policies are cancelled.\n- **Approved bodies**: Lists 167 approved financial exchanges and clearing houses worldwide where insurers can trade or hold investments.\n\n**Who it affects:**\n- Life insurance companies operating in Australia\n- Policyholders with annuities or life insurance\n- Foreign insurers wanting to enter the Australian market\n- Financial regulators (APRA)\n\n**Why it matters:**\nThese rules protect policyholders by ensuring foreign insurers meet standards, preventing companies from rushing through mergers without proper notice, limiting how much insurers can charge in late fees, and ensuring unclaimed money earns fair interest. The extensive list of approved bodies ensures insurers can only deal with reputable financial markets."},"flash_summary":{"complexity_score":5,"scope_assessment":{"changed":true,"description":"This instrument modifies the detailed regulatory scope compared with prior operational practice by prescribing new or specific mechanical tests and lists: it prescribes a 10‑year minimum annuity term (reg 5); it sets an explicit list of eligible foreign insurers by reference to incorporation and authorisation in specified jurisdictions (reg 6); it prescribes a 15‑day minimum notice period before a Court application for a transfer scheme (reg 7) and detailed documentary and timing requirements for APRA reporting of transfers, including an extension procedure (reg 8); it prescribes specific formulas for overdue premium interest and for interest payable on returned unclaimed money (regs 9–10); and it provides a detailed Schedule of approved bodies (Schedule 1). The instrument also provides transitional carve‑outs for transfers completed before commencement, preserving the earlier regulation 9.04 for those completed transfers (regs 12–13)."},"complexity_factors":["Multiple cross‑references to the Life Insurance Act 1995 and other instruments (e.g. Payment Systems and Netting Regulations 2001) requiring cross‑checking (regs 3, 15).","Numerical formulas that rely on external published data series (RBA 10‑year bond yields and ABS March CPI index numbers) and specific rounding rules (regs 9(1)–(3), 10(7)–(11)).","Administrative timelines and procedural steps with limited APRA discretion and a reviewable refusal (reg 8(2)–(5)).","A long, specific Schedule of approved bodies that creates a definitive list which must be consulted and possibly updated by regulation (Schedule 1).","Several distinct subject areas in one instrument (definitions, overseas eligibility, transfers/amalgamations, interest rules, unclaimed money, net claim value and transitional provisions), increasing the areas of operational impact."],"plain_english_summary":"# What these regulations do (in plain English)\n\n- What the instrument is and when it starts: The Life Insurance Regulations 2024 (made under the Life Insurance Act 1995) set detailed rules for a number of technical matters affecting life insurers, policy terms, transfers of business, interest calculations and certain definitions. The whole instrument commences on 1 March 2024 (regs 2–3).\n\n- Definitions and basic labels: The regulations add and clarify defined terms used under the Act (for example, allocated annuity policy, deferred annuity policy, immediate annuity policy and what counts as a certified copy) and point to other statutory definitions in the Act (reg 4; regs 14–16).\n\n- Minimum annuity term: For the Act’s requirement about minimum annuity terms, a 10‑year term is prescribed (reg 5). This sets the minimum period to be treated as a life policy term for particular Act provisions.\n\n- Which foreign insurers qualify as \"eligible\" for Australian branches: The regulations specify that a foreign life insurer will meet the Act’s eligibility condition only if it is both authorised to carry on life insurance in, and incorporated in, one of the listed jurisdictions: China (excluding Hong Kong, Macao and Taiwan as defined at reg 6(2)), Japan, New Zealand, the Republic of Korea, or the United States (reg 6). In short, incorporation and authorisation in one of those countries is the mechanical requirement the regulation prescribes (reg 6).\n\n- Timing and information for transfers and amalgamations of life business:\n  - A company proposing a scheme for transfer or amalgamation must not apply to the Court for confirmation earlier than 15 days after an approved summary of the scheme has been given to all affected policyholders, unless the Court dispenses with that requirement (reg 7).\n  - When life insurance business is transferred or amalgamated, the receiving company must give APRA specified documents (statement of nature and terms, certified copies of the scheme, actuarial reports on which it is founded (if any), the carrying agreement or deed, the Court order confirming the scheme and a statement of assets and liabilities) and a statutory declaration by the principal executive officer setting out payments made and reasonably estimated future payments (reg 8(1)(a)–(c)).\n  - Those documents must be given to APRA within 30 days after the transfer or amalgamation is completed (reg 8(2)), but a company may apply to APRA for an extension before the 30 days expire. APRA must decide within 14 days and may grant up to a further 30 days if it believes it was not reasonably possible to comply (reg 8(3)–(4)). A refusal to grant an extension is a reviewable decision under the Act (reg 8(5)).\n\n- Interest on overdue premiums charged to policyholders: The rate that a life company may charge on an overdue premium on any day is prescribed as the 10‑year Commonwealth Government bond yield (worked out as a six‑half‑financial‑year mean of figures published by the Reserve Bank of Australia) plus 3 percentage points (reg 9(1)–(3)). The mean is rounded down to the nearest 0.25 percentage point if necessary (reg 9(3)). That is the mechanical formula insurers must use when setting or applying overdue interest.\n\n- Interest payable when unclaimed money is returned to a life company: If a company previously paid unclaimed money to the Commonwealth and some or all is later returned, the regulations prescribe how to calculate interest payable on the returned amount (reg 10). Key mechanical points:\n  - Work out interest separately for each payment to and from the Commonwealth (reg 10(3)–(4)).\n  - The interest period starts on the later of 1 July 2013 or the day the company paid the money to the Commonwealth and ends on the 14th day after the Minister causes the money to be paid back to the company (reg 10(5)).\n  - Interest is calculated year‑by‑year using a formula that applies an annual interest rate (derived from March CPI quarterly movements) pro‑rated by the number of days in each financial year that fall within the interest period (regs 10(6)–(9)). Rounding rules apply: down to whole cents for annual interest amounts (reg 10(8)), interest‑rate rounding to the nearest 0.0001% upward (reg 10(10)), and negative rates are rounded up to 0% (reg 10(11)).\n\n- How to calculate a policy’s net claim value: The net claim value at a particular time is the amount payable in respect of the claim (either the maturity or death amount, or the amount that would be payable on voluntary termination) less any debts owed to the insurer under or secured by the policy (reg 11).\n\n- Transitional application for transfers and the continuation of an earlier rule: The regulations make clear that section 7 (timing of court application) applies to schemes applied for on or after commencement; and that, despite repeal by another instrument, the old regulation 9.04 of the Life Insurance Regulations 1995 continues to apply to transfers completed before the commencement date; section 8 applies to transfers completed on or after commencement (regs 12–13).\n\n- Approved bodies: Schedule 1 lists, in the instrument itself, the exchanges, markets, clearing houses and other entities that count as \"approved bodies\" for the Act’s Schedule 1 purposes. The list is long and specific (Schedule 1).\n\nWhy these mechanics matter (official purpose‑claims and practical consequences)\n\n- Officially stated or implied purposes: The rules prescribe exact mechanical conditions and formulas for features that the Act leaves to regulation — for example, the minimum annuity term (reg 5), which foreign insurers count as eligible for rules about Australian branches (reg 6), timelines and documents for transfers and amalgamations (regs 7–8), standard formulas for overdue interest and returned unclaimed money interest (regs 9–10), and objective measures for net claim value (reg 11). The instrument therefore translates high‑level Act requirements into implementable tests and numeric formulas.\n\n- Who pays and who decides:\n  - Policyholders bear the cost of overdue premium interest charged by insurers under the formula in reg 9. Insurers decide to charge overdue interest but must use the prescribed formula and rounding rules (reg 9).\n  - The Commonwealth pays interest to a life company when returning unclaimed money; the amount payable to the company is computed by the formulas in reg 10, so the Commonwealth bears that financial flow when it returns funds (reg 10(2)–(7)).\n  - Companies proposing transfers/amalgamations must produce documents and a statutory declaration; APRA reviews those documents and has limited discretion to extend time by up to 30 days if it concludes delay was reasonable (reg 8(2)–(4)). A refusal to extend is reviewable (reg 8(5)).\n  - The regulation prescribes objective eligibility (incorporation plus authorisation in listed countries) for foreign companies (reg 6), limiting administrative discretion on that point.\n\n- Compliance burden, cost and administrative trade‑offs:\n  - Insurers must implement specific calculation methodologies that require external data: Reserve Bank published yields for reg 9, and Australian Bureau of Statistics CPI quarter index numbers for reg 10 — both require periodic data collection and specific rounding methods (regs 9(2)–(3), 10(7)–(10)). That imposes a modest operational requirement to fetch published data and apply formulas correctly.\n  - Transfers and amalgamations impose a document production and corporate‑governance burden (statutory declaration by the principal executive officer, certified copies of actuarial reports, scheme documents, Court orders, asset/liability statements) and a tight initial 30‑day deadline with a specified extension process (reg 8(1)–(4)). Those mechanics concentrate documentary obligations on the transferring/receiving entities.\n  - The approved bodies list (Schedule 1) is long and specific. Any market participant relying on the \"approved body\" status must consult the schedule to confirm qualification; changes require an amendment to the regulations.\n\n- Discretion and reviewability:\n  - APRA has constrained discretion on time extensions for delivery of transfer documents (it must decide within 14 days and may grant up to 30 days where non‑compliance was not reasonably possible) and a refusal is reviewable (reg 8(3)–(5)).\n  - Other determinations (for example, what counts as a policy’s debts or whether a policy has matured) will feed into the numeric tests the regulations prescribe, but the regulations themselves set the calculation formulas (reg 11).\n\n- Market and competition effects to note (mechanisms, not judgments):\n  - The eligible foreign insurer rule (reg 6) creates a bright‑line test based on incorporation and authorisation within certain jurisdictions. That test mechanically limits which foreign incorporated insurers may rely on the Act’s provisions for Australian branches.\n  - The overdue interest formula (reg 9) ties private credit costs (overdue premiums) to a public‑bond benchmark plus a fixed margin. That directly links private charges to public market yields and therefore to movements in the bond market.\n\n- Implementation risks and unintended‑consequence seams to watch:\n  - Reliance on external published series (RBA bond yields and ABS CPI indexes) creates operational dependencies: missing data, publication timing or changes in series methodology could complicate day‑to‑day application (regs 9(2), 10(9)).\n  - The long, fixed list of approved bodies is administratively rigid: new trading venues or clearing arrangements will need a regulatory amendment or other mechanism to be treated as approved bodies (Schedule 1).\n\nSource references: specific provisions are cited above (reg numbers, Schedule 1)."}},"importantCases":[],"_links":{"self":"/api/acts/life-insurance-regulations-2024","history":"/api/acts/life-insurance-regulations-2024/history","analysis":"/api/acts/life-insurance-regulations-2024/analysis","conflicts":"/api/acts/life-insurance-regulations-2024/conflicts","importantCases":"/api/acts/life-insurance-regulations-2024/important-cases","documents":"/api/acts/life-insurance-regulations-2024/documents"}}