The Australian Prudential Regulation Authority (APRA) has released final prudential standards on enhancements to the prudential framework for life insurance companies.

Legislation was passed in 2009 that gave APRA power to regulate non-operating holding companies (NOHCs) of life insurance companies, including the power to determine prudential standards for life NOHCs. APRA will apply to these NOHCs the same governance and fit and proper standards that currently apply to NOHCs of authorised deposit-taking institutions (ADIs) and general insurers.

APRA has also made some limited amendments to the audit and actuarial requirements for life companies to align them more closely with those for ADIs and general insurers.

The package consists of the following revised prudential standards:

Prudential Standard LPS 510 Governance (LPS 510);
Prudential Standard LPS 520 Fit and Proper (LPS 520);
Prudential Standard LPS 310 Audit and Related Matters (LPS 310); and
Prudential Standard LPS 320 Actuarial and Related Matters (LPS 320).

The four revised prudential standards will take effect from 1 July 2010.