Application to renew a specialised insurer licence: requirements

1. Introduction

State Insurance Regulatory Authority (SIRA) may approve a renewal of an insurer licence and endorse the licence with a specialised insurer endorsement in accordance with the Workers Compensation Act 1987 (1987 Act).

Once endorsed, a specialised insurer is licensed to underwrite workers compensation risks for employers within an approved Defined Industry agreed by SIRA.

SIRA expects specialised insurers, in respect of their Defined Industries, to deliver optimum workers compensation outcomes to employers and workers sustainably by:

promoting work health and safety, recovery outcomes and return to work practices for the Defined Industry
providing access to fair and reasonable workers compensation insurance in connection with suitable risk assessment
satisfying the requirement of the Australian Prudential Regulation Authority (APRA) to demonstrate the solvency of the specialised insurers
investing in appropriate systems and infrastructure to meet the legislative requirements and expectations of employers, workers and SIRA, in respect of:
- support to the employer’s work health and safety practices
- underwriting and premium calculation
- claims management
- return to work planning and administration
- data and information required to assist SIRA in its ongoing monitoring, regulation and review of the specialised insurers.
complying with legislative requirements, licensing framework and conditions, and statutory guidelines as required.

These requirements describe what is required of applicants to demonstrate their ability to meet SIRA’s expectations and SIRA’s assessment process of an application to renew a specialised insurer licence.

2. Legislative requirements

SIRA assesses reapplications for renewal of a specialised insurer licence against the requirements in the 1987 Act and its Licensing framework for specialised insurers.

Under section 178 of the 1987 Act, SIRA may take the following matters into consideration in its determination of a reapplication for a licence:

the suitability of an applicant
the capital position and articles of association of an applicant that is a corporation
the orderly run-off of claims for compensation
the efficiency of the workers compensation system generally
any other matters as SIRA thinks fit.

In accordance with section 177A of the 1987 Act, SIRA will consider the following matters as it determines the merits of a reapplication for a specialised insurer licence:

that the insurance business to be carried on under the licence will not have an adverse effect on the efficiency of the NSW Workers Compensation Scheme (the Scheme) generally
that the applicant is limited to a clearly defined industry agreed to by SIRA and that the application is supported by relevant professional, business and other industry bodies involved in the particular industry
that the applicant is authorised under relevant Commonwealth legislation to carry on insurance business in Australia
any other matters SIRA considers relevant.

Other matters SIRA considers relevant include:

the applicant must be able to fund the establishment of an insurance operation and meet future liabilities
the applicant must have an appropriate reinsurance plan and proposed arrangements for its operations
the applicant must be a company that is owned and controlled by a relevant professional, business or other industry body
the directors of a specialised insurer collectively must have extensive experience and skills in the Defined Industry, workers compensation insurance and underwriting
the applicant must demonstrate its capability and capacity to undertake workers compensation insurance business in NSW and comply with all workers compensation statutory requirements.

3. Renewal

If a specialised insurer elects to apply to renew its endorsement as a specialised insurer, the application must be submitted to SIRA no later than four months prior to the expiry of the current licence.

In order to apply for renewal of endorsement as a specialised insurer, the applicant must continue to satisfy, or make any changes where necessary to satisfy the conditions outlined in its licence.

4. Assessment process

When assessing a renewal SIRA will consider:

the performance of the specialised insurer and its compliance with the requirements outlined in workers compensation legislation, the Licensing framework for specialised insurers and licence conditions
information received from APRA
information received from the specialised insurer
information provided in support of a reapplication for licence endorsement.

SIRA may also consider information from a variety of sources, which may include on-site audits, interviews and inspections. Additional information may be requested.

5. Defined Industry

SIRA assumes that the Defined Industry as stated within the current licence will carry forward to the new licence upon renewal.

Any request to materially change the Defined Industry may require the applicant to lodge an application in accordance with the Application for a new specialised insurer licence: requirements.

6. Information to be provided

The requirements in this document describe the information needed to support a reapplication, so SIRA can determine the eligibility of the applicant and be satisfied with the reapplication under sections 177A and 178 of the 1987 Act and the Licensing framework for specialised insurers. Failure to provide the information as required may result in your reapplication being suspended or refused.

A specialised insurer may state in their reapplication why the licensing framework, or aspects of it, do not apply to their current licence and will continue to not apply to their reapplication.

A reapplication for endorsement must contain a written authority (Attachment A) including:

confirmation of compliance with licensing framework and conditions, or
a statement of non-compliances and when the approval was granted by SIRA.

7. Notice of licence application

SIRA will post a notification on its website after a formal application for a new licence is received. SIRA will consider any submissions received in response to the notification when determining the application for a new specialised insurer licence.

8. Application fee

There is no application fee to renew a specialised insurer licence.

9. Lodging an application

The application should be lodged with:

Director, Insurer Supervision
State Insurance Regulatory Authority
Locked Bag 2906, Lisarow, NSW 2252

Email: [email protected]

10. Further information

For further information please contact:

Director, Insurer Supervision
State Insurance Regulatory Authority
92–100 Donnison Street, Gosford, NSW 2250
Locked Bag 2906, Lisarow, NSW 2252

Phone: 13 10 50
Email: [email protected]

11. Confidentiality

Where information is provided to SIRA, the information is protected by provisions in the Workplace Injury Management and Workers Compensation Act 1998 and may only be disclosed externally in very limited circumstances. These provisions do not inhibit SIRA’s ability to:

create comparative data to conduct research and assess the performance of the workers compensation scheme
publish de-identified statistical, performance and research reports
provide information to the responsible Minister or as directed by the Minister
provide information to APRA.

Apart from these protections, personal information or health information provided to SIRA can only be dealt with in accordance with the Privacy and Personal Information Protection Act 1998 and the Health Records and Information Privacy Act 2002.

Although the Government Information (Public Access) Act 2009 (GIPA) creates a presumption in favour of the disclosure of government information when an access application is made, this can be overcome where there is an overriding public interest against disclosure. GIPA provides a specific public interest consideration against disclosure of information held by SIRA if (amongst other things) disclosure of the information could prejudice the business interests of any person or corporation.

GIPA provides a mechanism for consultation with a person or corporation if an access application is made for information that concerns the business, commercial or financial interests of that person or corporation. Any objection to disclosure received in the course of consultation must be taken into account in determining whether there is an overriding public interest against disclosure. Any decision by SIRA to make available that information contrary to an objection made in the course of consultation would be subject to a right of review by the Information and Privacy Commissioner or by the NSW Civil and Administrative Tribunal.