Interim Solvency Standard For Insurers Issued
The Reserve Bank has today issued its Interim Solvency Standard, informed by two years of planning and consultation with the insurance industry and other interested parties.
The Reserve Bank of New Zealand – Te Pūtea Matua is responsible for the prudential regulation of New Zealand’s insurance sector, and started a review of the existing suite of insurance solvency standards in mid-2020, in part to address the new accounting standard for insurance contracts (NZ IFRS 17).
The solvency standards are being reviewed alongside the Insurance (Prudential Supervision) Act 2010 (IPSA) - the primary legislation that empowers regulation and supervision.
“Solvency standards are a key piece of secondary legislation empowered by IPSA,” Deputy Governor Christian Hawkesby says.
“I want to express my thanks to all those who took the time to submit their views during our consultations. This process has helped to ensure that the interim standard will streamline solvency calculations and be fit-for-purpose,” Mr Hawkesby says.
The interim standard comes into force on 1 January 2023 and will be applied to individual non-exempt insurers at various times in 2023 by changes to their condition of licence. Insurers should now begin using this standard in their projections.
The Interim Solvency Standard is being issued alongside a regulatory impact statement. Questions about the new standard can be addressed to firstname.lastname@example.org.
A Final Solvency Standard will be consulted on in a second stage of the review of the Solvency Standards.