General Insurance Practice Committee – (GIPC)

The last 12 months has been a busy and dynamic period in the general insurance space. This article aims to give readers a taste of recent goings-on within the GIPC.

PHOTO: Back L to R: David Koob, Kaise Stephan, Tim Clark, Andrew Huszczo, Scott Collings and Andy White
Front L to R: Elayne Grace, Richard Yee, Susan Ley, Robert Thomson and Samantha Fuller
Absent: Arie van den Berg, Jennifer Dang, David Gifford and Peter McCarthy

SO WHO ARE WE?

Currently we have 13 members who look after 14 areas of responsibility including personal injury, APRA, education and CPD.

The GIPC meets monthly to discuss initiatives in General Insurance and how the Actuarial profession can apply its skills in these areas. Initiatives include education, responding to public inquiries or making a meaningful contribution to public policy/ debate, organising seminars and topical insight sessions (which help you network and get your CPD) and updating professional standards, guidance and information notes (which guide and protect the profession).

The GIPC also liaises with other professional and interested parties such as APRA, ICA, other Actuarial Practice Groups, Council and Governments.

As volunteers we do depend on other members of the profession helping us steer Actuaries into the future and we thank those outside the committee who have also provided support and content over the year.

The committee acknowledges Peter Hardy’s contributions to the GIPC over the past three years. Peter was involved in a variety of areas for professional standards, including the release of information notes and the revision of professional standards in consideration of the impact of LAGIC.

This year the committee welcomed two new members, Arie van den Berg, who assists with member liaison and Susan Ley, who coordinates review of the professional standards.

WHAT WERE SOME OF THE ITEMS ON OUR RADAR OVER THE LAST YEAR?

APRA

Scott Collings

  • Submission on APRA’s Discussion paper ‘Harmonising cross-industry risk management requirements’, which proposed harmonised risk management requirements practices across industries, following the submission on APRA’s draft prudential practice guide CPG 220 Risk Management.
  • Regular liaison meetings with APRA on topical issues.
  • We also have an APRA representative on GIPC (Robert Thomson).
  • Considered various public consultations, including:
    – Confidentiality of general insurance data and changes to general insurance statistical publications.
    – Reinsurance counterparty data collection for general insurers.
  • Submission on APRA’s draft LPG270 Group Insurance Arrangements.
  • As a result of speeches by Ian Laughlin (Deputy Chairman of APRA) and a letter from APRA in December 2013
    to insurer CEOs and Board members regarding Catastrophe Risk Governance and Management, GIPC has organised the Catastrophic Risk Seminar and is considering issuing a guidance note to assist actuaries.

COUNCIL

Andrew Huszczo

  • Regularly liaising with the Council of the Actuaries Institute to ensure that GIPC issues are raised at Council and that relevant issues raised at Council are discussed and actioned by GIPC.

COMMUNICATION

Kaise Stephan and Arie van den Berg

  • Continued to provide topical updates to members via the monthly bulletins and the interposing themed quarterly newsletters. The newsletters had themes that ranged from the National Disability Insurance Scheme to the role of technology in general insurance.
  • Performed a survey of members to assist GIPC with its review of its areas of activities. The survey asked questions relating to members’ experience and opinions on GIPC initiatives including communication, CPD, research and public policy submission and asked members to comment on areas of improvement.
  • Provided input into articles for the Actuaries magazine.
  • Continued to update the Actuaries Institute website in relation to general insurance matters.

PERSONAL INJURY SCHEMES AND DISABILITY

David Gifford

  • Keeping a watch on developments in personal injury schemes which include reviews and reforms one of which has been NSW CTP.
  • Watching briefs on NDIS and NIIS developments which are closely related to CTP and workers compensation schemes.
  • Considered the Transport Accident Amendment Bill which is aimed at ensuring that people affected by road trauma receive the most appropriate care, treatment and compensation well into the future.
  • Submission to WorkCover NSW on Specialised Insurers Licensing Policy.

SEMINARS AND CPD

Samantha Fuller and Richard Yee

    • The inaugural Risk and Regulation Seminar was held in Sydney on Monday 26 and Tuesday 27 August 2013.
    • The 2013 Injury Schemes Seminar was held at the Sheraton Mirage Gold Coast, from Sunday – Tuesday 10-12 November 2013.

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  • The Catastrophe Risk Seminar was held at Amora Hotel Jamison Sydney on 3 June 2014.
  • The Insight session: Update from the General Insurance Risk Appetite Working Party was held in Sydney on Thursday 1 May 2014.
  • Further Insight sessions in 2014 are being planned in conjunction with the Actuaries Institute.

RESEARCH

David Koob

  • Various research working parties operated in the last year covering risk appetite, discount rates, profit margins and general insurance management accounts.
  • The Australian Research Council has granted just over $230,000 for a three year research project commencing from 2014, titled ‘Modelling Claim Dependencies for the General Insurance Industry with Economic Capital in View: An Innovative Approach with Stochastic Processes’. This project will involve collaboration amongst actuaries in academia and industry.
  • In conjunction with LIWMPC a working party has been formed to investigate the feasibility of undertaking research into the affordability of insurance premiums and drivers of claims cost.
  • Also in conjunction with the LIWMPC a working party has been formed to investigate the feasibility of undertaking research into mortality of disabled lives in relation to the NIIS, NDIS and life insurance.

INDUSTRY

Tim Clark

  • GIPC keeps abreast of industry developments and initiatives primarily through GIPC members who work in general insurers and through involvement with the Insurance Council of Australia.
  • Anti-Discrimination Cross-Practice Working Group has been formed to respond to government focus on anti- discrimination law and how it relates to the use of actuarial data in determining premium rates and product design for insurance and superannuation products. The Actuaries Institute was invited to join a new steering group set up by the Australian Human Rights Commission on this issue.

OTHER PUBLIC POLICY MATTERS

  • The GIPC assists the Actuaries Institute with media matters, including acting as a spokesperson on topical matters or drafting media releases or opinion pieces.
  • On 20 November 2013 the Government released its Draft Terms of Reference for the Financial System Inquiry. The Inquiry will make recommendations on the nature of the regulatory arrangements that will best ensure an efficient, responsive, competitive and flexible financial system to underpin stronger economic performance, consistent with financial stability, prudence, integrity and fairness. A working group has been formed and a submission has been made regarding the Inquiry’s Terms of Reference. The Actuaries Institute will continue to be involved with developments on the Inquiry. Representatives from GIPC has representatives on the working group.

PROFESSIONAL STANDARDS

Susan Ley

  • Release of an information note on Insurance Concentration Risk Charge – Other Accumulations Vertical Requirement.
  • Consideration of the International Actuarial Association’s proposal to develop an International Standard of Actuarial Practice on IFRS x (Insurance Contracts).
  • In response to APRA’s focus on catastrophe risk management, a working party has been formed to prepare an information note for catastrophe modelling. Actuaries may find it useful to consider the points in the Actuarial Standards Board’s Actuarial Standard of Practice (ASOP) 38 described in the GIPC March Newsletter, which covers the use of models outside the member’s area of expertise.
  • The draft updates to PS 300 Valuations of General Insurance Claims and PS 305 Financial Condition Reports and Review of Run-off Plans for General Insurance were finalised in March 2013.

EDUCATION

Andy White

  • The syllabus and course content for the General Insurance specialist courses 3A and 3B underwent a material revision during 2013. This review has resulted in thorough and up-to-date course content.

ACCOUNTING STANDARDS

Kaise Stephan

  • The GIPC keeps watch on developments in accounting standards that may impact the general insurance industry.

OVERSEAS DEVELOPMENTS

Kaise Stephan

  • The GIPC continues to link with other Institute committees internationally and coordinate its activity with overseas professions and related organisations.

UPCOMING EVENTS

  • General Insurance Seminar 2014
    The General Insurance Seminar: Insuring Tomorrow will be held at the Hilton Sydney, Monday 17 to Tuesday 18 November 2014.

  • Enterprise Risk Management Seminar 2014 The Enterprise Risk Management Seminar: Capturing the Upside will be held at the Hilton Sydney, Wednesday 19 November 2014.

Got feedback, questions or interested in helping out?

Please feel free to contact any one of us!

Peter McCarthy (convenor)
Andrew Huszczo
Andy White
Arie van den Berg
David Gifford
David Koob
Kaise Stephan
Richard Yee
Robert Thomson
Samantha Fuller
Scott Collings
Susan Ley
Tim Clark
Elayne Grace (Actuaries Institute – Public Policy)
Jennifer Dang (Secretary)

And if you’re hungry for a regular dose of GIPC, don’t forget to subscribe to the GIPC bulletin or newsletter (via changing your details on the Actuaries Institute website) and/or monthly GIPC meeting minutes. The monthly GIPC meeting minutes are available from the GIPC secretary Jennifer Dang.

Lastly, thanks to all of the many Institute, working party and sub-committee members who have contributed their time and effort to activities overseen by the GIPC.

Thanks also go to the GIPC members for their service over the last year as it has certainly been a busy period!

CPD: Actuaries Institute Members can claim two CPD points for every hour of reading articles on Actuaries Digital.

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