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Insurance (prudential standard) determination No. 1 of 2025
Transfer and Amalgamation of Insurance BTransfer and Amalgamation of Insurance Business
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Commonwealth Coat of Arms of Australia
Prudential Standard GPS 410
Transfer and Amalgamation of Insurance Business for General Insurers
| Objectives and key requirements of this Prudential StandardThis Prudential Standard deals with the transfer or amalgamation of insurance business of a general insurer.Insurers transferring or amalgamating insurance business in accordance with the Act are subject to procedural requirements set out in the Act and this Standard. These requirements are designed to ensure that affected policyholders, and other interested members of the public, are informed about any such transfer or amalgamation, are given accurate information about it, and are provided with the opportunity to obtain more detailed particulars if they wish to do so.The key requirements of the Act and this Prudential Standard are:An insurer cannot make an application to the Court for confirmation of a scheme of transfer or amalgamation unless, amongst other things, the insurer provides to APRA a copy of the scheme, any actuarial reports on which it is based and a copy of the proposed business transfer agreement.After approval by APRA and prior to making an application to the Court, the insurer must:publish a notice of intention to make the application and a copy of a summary of the scheme (the approved summary) in a manner that results in the documents being accessible to the public and reasonably prominent;give a copy of the approved summary to every affected policyholder. An insurer to which insurance business is transferred or amalgamated must give APRA a range of documents after the Court has approved the scheme, including a statement of the nature and terms of the transfer or amalgamation, and the Court order confirming the scheme.Details on these requirements are contained below. |
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Prudential Standard
- This Prudential Standard, made under section 32 of the Insurance Act 1973 (the Act), applies to all general insurers authorised under the Act.
- A transfer or amalgamation of insurance business can occur only under a scheme confirmed by the Federal Court (unless it is undertaken in response to a direction from the Australian Prudential Regulation Authority (APRA)[1]). This Prudential Standard sets out specific requirements in relation to documentation, notification, public inspection and an application to the Court.
- In addition, any transfer or amalgamation of insurance business is subject to the provisions of the Insurance Acquisitions and Takeovers Act 1991 (IATA). The IATA requires compulsory notification of proposals involving the acquisition of any or all of the interests, rights or benefits of an insurer under contracts of insurance where that transfer amounts to 15% or more of the transferring insurer’s premiums or outstanding claims liabilities.