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Specialised insurer annual information: requirements

1. Introduction

The State Insurance Regulatory Authority (SIRA) licenses specialised insurers under the Workers Compensation Act 1987 (1987 Act) to underwrite workers compensation risks for employers of a defined industry.
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 requirements 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 requirement, as well as the 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 policy and conditions, and statutory guidelines as required.

2. Provision of data and information

In accordance with section 189 of 1987 Act, SIRA may require a specialised insurer to disclose or provide access to specific information in respect of the insurer’s business and financial position or forward specified records.

A specialised insurer may be also required to provide to SIRA any information and correspondence with APRA concerning the Financial Sector (Collection of Data) Act 2001, the Insurance Act 1973 and the Insurance Regulations, the specialised insurer’s capital adequacy and its workers compensation business.

Without limitation, SIRA may use information and data requested under these requirements and as provided from the specialised insurer for the purpose of:

  • carrying out its functions of ensuring compliance with the workers compensation and the work, health and safety legislation
  • monitoring the efficient operation and performance of workers compensation insurance arrangements
  • reviewing key indicators of financial viability and other performance aspects of the insurance arrangements, including reporting and benchmarking of the specialised insurer’s performance.

3. Reporting requirements

To assist in its ongoing monitoring, regulation and review of specialised insurers, SIRA requires specialised insurers to provide the following information to SIRA under section 189 of the 1987 Act.

This information must be provided within three months of the end of a specialised insurer’s financial year.
Specialised insurers need not resubmit documents that have previously been provided to SIRA. Where information previously provided remains unchanged, it will be sufficient for the specialised insurer to advise ‘no changes’.

Please note SIRA’s preference is for the requested information to be provided in soft copy where possible.

3.1 Corporate details

  • Name of the principal person for the receipt of correspondence from SIRA. Other details required:
    • position title
    • telephone number
    • fax number
    • email address
    • mailing address
    • street address.
  • Name and details (as above) of the secondary contact to receive electronic correspondence from SIRA, such as general correspondence. SIRA will send this type of correspondence to both contacts, however, it will direct work, health and safety and case management audit reports and related correspondence (normally distributed in hard copy) to the principal contact.
  • Confirmation that the specialised insurer has maintained its authority to carry on insurance services under the Insurance Act 1973.
  • Update of any changes in the ownership and voting rights of the specialised insurer.
  • Confirmation that the specialised insurer has satisfied the following criteria of ownership and control with the relevant professional business or industry body:
    • ultimate beneficial ownership of at least 50 per cent of the shares and paid up capital of the insurer
    • control of at least 50 per cent of the votes at a general meeting of the insurer.
  • Current board structure and confirmation that the directors collectively have demonstrated experience and skills in:
    • the industry that is the subject of the specialised insurance arrangement
    • workers compensation insurance
    • underwriting.

3.2 Defined Industry

  • Confirmation that the specialised insurer:
    • only issued and renewed workers compensation insurance policies to employers operating in the Defined Industry that has been agreed by SIRA
    • offered fair and reasonable workers compensation insurance to all employers within the Defined Industry with suitable risk assessment.
  • Details of any exceptions to the above.

3.3 Annual report and financial information

  • A copy of the annual report, including audited financial statements and independent auditors’ report, for:
    • the specialised insurer
    • its ultimate holding company, if it is a subsidiary of an Australian holding company.
  • A certificate from the specialised insurer’s independent auditor certifying that for the previous financial year the insurer has remitted four per cent of gross premium collected to SIRA.
  • Information to satisfy SIRA that it is adequately capitalised, has a strong financial position based on net tangible assets, and has a sound profit and cash flow history.
  • Information to satisfy SIRA that it has appropriate re-insurance cover by providing details of the reinsurance plan and current arrangements, including copies of the reinsurance policy and certificate of currency.

3.4 Actuarial report

  • An actuarial report on the specialised insurer’s outstanding claims liabilities for the last financial year, in accordance with the Specialised Insurer Licensing Policy requirements.

3.5 Case management details

  • Current injury management program developed in accordance with the requirements of section 43 of the Workplace Injury Management and Workers Compensation Act 1998 with any revisions notified to SIRA or confirmation that there are no changes to the program already lodged with SIRA. Specialised insurers should revise their injury management program in line with changes to legislation, directions, statutory guidelines and additional conditions of licence issued by SIRA and the specialised insurer’s policies and procedures.
  • Self-audit using SIRA’s Insurer audit manual. Specialised insurers must submit self-audit results annually or as specified by SIRA as a remediation action following a SIRA audit. A self-audit will not be required in the same financial year as a SIRA audit unless otherwise specifically requested by SIRA. The report of the self-audit must include the quality improvement plan of corrective and preventative actions designed to address any identified areas of non-conformance and opportunities for improvement as well as strategies to monitor and review their effectiveness.
  • Confirmation that the specialised insurer has not outsourced the whole, or any part, of any key operational functions of its workers compensation insurance business not previously approved by SIRA or changed third party providers for approved outsourced arrangements.

3.6 Work health and safety details

Details of any changes to the specialised insurer’s Work Health and Safety Loss Management Program.

3.7 Performance data

Performance data in order for SIRA to report an insurer scorecard to demonstrate achievement by specialised insurers in the key Workers Compensation System objectives of return to work and loss ratio.

The data requested is listed below:

  • employer legal name
  • policyholder identification number
  • employer ABN
  • period commencement date
  • period expiry date
  • number of employees
  • amount of wages paid by WorkCover Industry Classification (WIC)
  • WorkCover Industry Classification (WIC)
  • total premium payable

The data is to be provided in the format as described by SIRA in Appendix A.

3.8. Lodgement

Please lodge the section 189 information with your portfolio manager by emailing: [email protected].

If you have any questions in regards to these information requirements please contact your portfolio manager.

4. 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 the Australian Prudential Regulation Authority.

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.

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