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Contents (2017 - 10)
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Motor Accident Injuries Act 2017 No 10
Current version for 1 February 2019 to date (accessed 19 September 2019 at 01:25)
Part 9 Division 9.2
Division 9.2 Supervision of licensed insurers
9.16   Authority guidelines for market practice
(cf s 171 MACA)
The Motor Accident Guidelines may deal with the issue of third-party policies by licensed insurers.
9.17   Determination of market share of each insurer
(cf s 172 MACA)
(1)  A licensed insurer must, within such time after the end of each quarter and each year as is determined by the Authority, notify the Authority of the amount of insurance premiums received by it in relation to all third-party policies taken to have been issued by it during that quarter or year.
(2)  The Authority must, after notifications have been received from all licensed insurers in respect of a quarter or year, determine, in relation to each insurer, the proportion that the insurance premiums for third-party policies received by the insurer for the quarter or year bears to the aggregate amount of insurance premiums for third-party policies received by all licensed insurers for the quarter or year.
(3)  The Authority may round a proportion determined under this section to one-tenth of a percent.
(4)  After determining the proportion for each licensed insurer, the Authority must inform all licensed insurers of the proportions so determined.
(5)  In this section:
quarter means a quarter ending on the last day of September, December, March and June in each year.
year means a year commencing on 1 July.
9.18   Business plans of licensed insurers
(cf s 173 MACA)
(1)  A licensed insurer must prepare and deliver to the Authority a business plan for its third-party insurance business as soon as practicable after it is requested to do so by the Authority.
(2)  The licensed insurer must revise its business plan:
(a)  whenever it departs significantly from its business plan, and
(b)  at such intervals of not less than 12 months as the Authority directs.
(3)  The licensed insurer must, as far as practicable, conduct its third-party insurance business in accordance with its current business plan, but if it departs significantly from that plan the insurer must notify the Authority accordingly.
(4)  A business plan must be prepared in accordance with the Motor Accident Guidelines.
(5)  A business plan must describe the manner in which the insurer’s third-party insurance business is to be conducted (including claims handling, management, expenses and systems).
(6)  It is a condition of a licence granted under this Act that the licensed insurer must comply with this section.
(7)  In this section, a reference to the third-party insurance business of a licensed insurer is a reference to any business associated with third-party policies.
9.19   Re-insurance arrangements of licensed insurers
(cf s 174 MACA)
It is a condition of a licence granted under this Act that the licensed insurer must notify the Authority of:
(a)  particulars of arrangements made or proposed to be made for re-insurance in respect of liabilities under third-party policies issued by the licensed insurer, and
(b)  the terms of any approval of the Australian Prudential Regulation Authority under the Insurance Act 1973 of the Commonwealth in respect of any such re-insurance.
9.20   Investment of funds of licensed insurer
(cf s 175 MACA)
(1)  It is a condition of a licence granted under this Act that the licensed insurer, if required to do so by the Authority, must provide the Authority with details of the way in which its third-party funds and other funds are invested.
(2)  The third-party funds of a licensed insurer are the funds of the insurer derived from the payment of insurance premiums for third-party policies and from their investment.
9.21   Accounts, returns and other records of licensed insurer
(cf s 176 MACA)
(1)  A licensed insurer must keep such accounting and other records in relation to the business or financial position of the insurer:
(a)  as may be prescribed by the regulations, and
(b)  subject to the regulations, as may be directed by the Authority by notice served on the insurer.
(2)  The regulations may prescribe the manner in which financial transactions are to be accounted for in any such records.
(3)  A licensed insurer must lodge with the Authority returns in relation to the business or financial position of the insurer in such form, containing such particulars and accompanied by such documents:
(a)  as may be prescribed by the regulations, and
(b)  subject to the regulations, as may be directed by the Authority by notice served on the insurer.
(4)  Returns must be lodged:
(a)  subject to paragraph (b), within 6 weeks after each 31 March, 30 June, 30 September and 31 December, or
(b)  at such other times as the Authority, by notice served on the insurer, directs.
(5)  The regulations may require returns, and documents accompanying returns, to be certified by an auditor or by an actuary.
(6)  A licensed insurer who contravenes any requirement imposed on the insurer by or under this section is guilty of an offence.
Maximum penalty: 500 penalty units.
(7)  The Authority may make publicly available a copy of any return, and any documents accompanying a return, under this section.
(8)  In this section:
accounting records include invoices, receipts, orders for the payment of money, bills of exchange, cheques, promissory notes, vouchers and other documents of prime entry, and also include such working papers and other documents as are necessary to explain the methods and calculations by which accounts are made up.
9.22   Audit of accounting and other records and performance audit
(cf s 177 MACA)
(1)  The Authority may appoint an appropriately qualified person to audit or inspect, and report to the Authority on, the accounting and other records relating to the business or financial position of a licensed insurer, including accounting and other records relating to:
(a)  the manner in which its third-party funds and other funds are invested, or
(b)  compliance with this Act (including any guideline under this Act).
(2)  A person so appointed is (if directed to do so by the Authority) to report to the Authority on whether the licensed insurer is carrying out its third-party insurance business effectively, economically and efficiently.
(3)  A person so appointed is, for the purpose of exercising any functions under this section, entitled to inspect the accounting and other records of the licensed insurer.
(4)  A licensed insurer must provide all reasonable assistance to enable the exercise of those functions.
(5)  A person must not wilfully obstruct or delay a person exercising a function under this section.
(6)  A person exercising functions under this section has qualified privilege in proceedings for defamation in respect of any statement that the person makes orally or in writing in the course of the exercise of those functions.
(7)  A licensed insurer or another person who contravenes any requirement imposed on the insurer or other person by or under this section is guilty of an offence.
Maximum penalty: 500 penalty units.
(8)  The Authority may from time to time carry out an audit to determine the profitability of a licensed insurer and for that purpose may exercise the functions of a person appointed under subsection (1). The Authority is to report on any such audit to the Board of the Authority and to the Minister, on a confidential basis.
(9)  In this section, accounting records has the same meaning as in section 9.21.
9.23   Information and documents as to business and finances to be supplied to Authority by insurers and former insurers
(cf s 178 MAA)
(1)  In this section:
documents includes returns and accounts furnished under the Corporations Law, the Corporations Act 2001 of the Commonwealth and the Insurance Act 1973 of the Commonwealth.
insurer means a licensed insurer or a former licensed insurer.
(2)  The Authority may require an insurer:
(a)  to disclose to the Authority specified information relating to the business and financial position of the insurer or of any corporation which is a related body corporate (within the meaning of the Corporations Act 2001 of the Commonwealth), or
(b)  to forward to the Authority, or make available for inspection, specified documents, or copies of or extracts from specified documents, kept by the insurer or by any corporation which is such a related body corporate.
(3)  Subsection (2) extends to requiring:
(a)  financial information that is or may be relevant to the consideration by the Authority of insurance premiums filed by the insurer under this Act, and
(b)  information about the cost of claims handling incurred by the insurer and about the settlement of claims by the insurer, and
(c)  information about other matters concerning the insurer.
This subsection does not affect the generality of subsection (2), or any other provision of this Act regarding the obtaining of information by the Authority, and does not limit any other manner in which the Authority may obtain information.
(4)  A requirement under this section:
(a)  must be made in writing and served on the insurer, and
(b)  must specify the manner in which and the time within which the requirement is to be complied with.
(5)  The manner in which a requirement is to be complied with may include the supply to the Authority of a certificate by a registered tax agent, a registered company auditor (within the meaning of the Corporations Act 2001 of the Commonwealth) or an actuary approved by the Authority as to the correctness of any specified information or specified documents (or copies of or extracts from specified documents).
(6)  Unless the insurer satisfies the court that it is not within its power to comply with the requirement, an insurer that fails to comply with a requirement under this section is guilty of an offence.
Maximum penalty: 1,000 penalty units.
9.24   Reports about insurers
(cf s 179 MACA)
(1)  The Authority may from time to time forward to the Minister reports relating to:
(a)  the level of compliance by insurers with:
(i)  any requirements of this Act, and
(ii)  any conditions of licences under this Act (including any relevant Motor Accident Guidelines), and
(b)  complaints made about insurers, and any other matters relating to insurers, in connection with any matters to which this Act relates.
(2)  A report may relate to insurers generally, or to any class of insurers, or to any particular insurers.
(3)  A report may identify particular insurers.
(4)  A report may include such observations and recommendations as the Authority thinks fit.
(5)  The Minister may make a report public and may lay a report or cause it to be laid before both or either of the Houses of Parliament.
(6)  Nothing in this section affects reports that may be made apart from this section.
9.25   Power of Supreme Court to deal with insurers unable to meet liabilities
(cf s 180 MACA)
(1)  The Supreme Court may, on the application of the Authority, make such orders as the Supreme Court considers necessary or desirable for the purpose of protecting the interests of the holders of third-party policies taken to have been issued by a licensed insurer or a former licensed insurer.
(2)  The Supreme Court may make such an order if it is satisfied that the licensed insurer or former licensed insurer:
(a)  is not able to meet the insurer’s liabilities under the third-party policies or may not be able to do so, or
(b)  has acted or may act in a manner that is prejudicial to the interests of the holders of the third-party policies.
(3)  Without limiting the generality of subsection (1), the Supreme Court may make the following orders:
(a)  an order regulating the administration and payment of claims under the third-party policies,
(b)  an order prohibiting or regulating the transfer or disposal of, or other dealing in, the assets of the licensed insurer or former licensed insurer,
(c)  an order requiring the licensed insurer or former licensed insurer to discharge its liabilities under the third-party policies out of its assets and the assets of any related body corporate (within the meaning of the Corporations Act 2001 of the Commonwealth),
(d)  an order appointing a receiver or receiver and manager, having such powers as the Supreme Court orders, of the property or part of the property of the licensed insurer or former licensed insurer or of any such related body corporate.
(4)  If an application is made to the Supreme Court for an order under subsection (1), the Supreme Court may, if in its opinion it is desirable to do so, before considering the application, grant an interim order, being an order of the kind applied for that is expressed to have effect pending the determination of the application.
(5)  If an application is made to the Supreme Court for an order under subsection (1), the Supreme Court is not to require the Authority, as a condition of granting an interim order, to give any undertaking as to damages.
(6)  The Authority is to give the Australian Prudential Regulation Authority and the Australian Securities and Investments Commission notice of its intention to apply for an order under this section.
(7)  The Australian Prudential Regulation Authority and the Australian Securities and Investments Commission each has a right to appear and be heard in proceedings for an order under this section.
(8)  If the Supreme Court has made an order under this section, the Supreme Court may, on application by the Authority or by any person affected by the order, make a further order rescinding or varying the first mentioned order.
(9)  A person who contravenes, whether by act or omission, an order made by the Supreme Court under this section that is applicable to the person is guilty of an offence.
Maximum penalty: 100 penalty units or imprisonment for 6 months, or both.
(10)  The Supreme Court is not to exercise its powers under this section in respect of a corporation which is in the course of being wound up.
(11)  The powers of the Supreme Court under this section are in addition to any other powers of the Supreme Court.
9.26   Notification to Authority of certain defaults in relation to insurers
(cf s 181 MACA)
(1)  A licensed insurer and a former licensed insurer must notify the Authority in writing of the occurrence of any of the events or things referred to in section 9.9 (3) (paragraphs (a), (e), (j) and (m) excepted) within 21 days after the event or thing happens (whether within or outside the State).
(2)  A licensed insurer must notify the Authority in writing of:
(a)  a decrease or proposed decrease in the issued capital of the insurer within 21 days after the decrease or proposal to effect the decrease, and
(b)  the receipt by the insurer of any bidder’s statement or target’s statement within the meaning of the Corporations Act 2001 of the Commonwealth.
Maximum penalty: 100 penalty units.
9.27   Proceedings for failure to comply with licence
(cf s 183 MACA)
No proceedings may be taken against a licensed insurer for failure to comply with the terms of the licensed insurer’s licence or this Act or the regulations, except by the Authority.