News Regulations20 Nov 2018

New Zealand:Role of appointed actuary to be reviewed

20 Nov 2018

The Reserve Bank of New Zealand (RBNZ) has commissioned a thorough independent review of the CBL Insurance case to identify lessons for itself and the insurance regulatory regime.

The review of the Reserve Bank's handling of troubled insurer CBL Insurance will include looking at the role of the appointed actuary, and whether it was given too much status in the regulation of insurers, according to a report in stuff.co.nz.

The review covers the period from CBL Insurance’s licensing in 2013 through to its interim liquidation in February this year.

RBNZ runs a "light-handed" form of regulation, and in the case of insurers, appointed actuaries calculate insurers' solvency positions.

CBL was placed into liquidation earlier this month by the Auckland High Court. Mr Toby Fiennes, RBNZ's head of prudential supervision, said at the liquidation hearing, "When you have the auditor and PWC presenting those numbers, it is difficult to challenge them," he said. PWC's involvement as appointed actuary was "influential", he said.

CBL Insurance ran into trouble as a result of its French building warranty insurance business.


 

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