APRA strengthens insurance inside super rules
![Red arrow breaking through square with The New Rules written in white](https://financialnewswire.com.au/wp-content/uploads/shutterstock_672251143.jpg)
The Australian Prudential Regulation Authority (APRA) has made key changes to its approach to insurance inside superannuation in response to industry feedback including strengthening the rules around balance erosion and third-party arrangements.
The changes have been outlined by APRA in a response paper published today with the regulator clearly concerned to ensure that related-party insurance arrangements are both independently assessed and certified as being in the best financial interests of members.
Superannuation funds will also be required to undertake “rigorous analysis” to ensure that the type of insurance they offer members does “not inappropriately erode the retirement income of beneficiaries.
The APRA documentation states that superannuation funds should consider the benefits and risks of insurance arrangements in strategy, in the context of its membership profile.
A key part of the APRA approach is that superannuation funds will have an obligation to make it easy for members to easily opt out of insurance including better communications around the benefits and costs of insurance arrangements.
APRA said the new arrangements would come into effect on 1 July, next year, with superannuation funds encouraged to get their houses in order before that start date.
Nah, the AMP vertically intergrated model is effectively dead. It's a broad APL. It wouldn't come as any surprise that…
So let me get this right - Canberra spends an awful lot of time and effort focusing on consumer protection/compliance…
Just wind them up please so the rest of the financial planning industry can move forward without an albatross around…
Compare the pair.
I have clients who have been told to produce evidence they are with cbus or else they can't work on…