Insurer licensing and supervision

How SIRA supervises insurers

SIRA’s licensing and regulatory frameworks maintain high performance standards across all insurers in the NSW Workers Compensation Scheme, assessing against conduct, claims management and financial viability benchmarks.

SIRA manages insurer performance through:

• regular engagement and feedback
• education and support
• building capability
• data analysis
• compliance and performance monitoring
• undertaking audits
• assessing risk and addressing poor compliance or performance.

Read SIRA's Regulatory Framework for more information.

Types of workers compensation insurers

SIRA regulates 4 types of NSW workers compensation insurers, working with each to manage risks and improve the customer experience and outcomes for workers with an injury.

The 4 insurer types:

• The Nominal Insurer (managed by icare) is funded by employer premiums. Claims are administered through Claims Service Providers engaged by icare. icare has more information in their Nominal Insurers Claims Model.
• The Treasury Managed Fund (managed by icare) insures government self-insurers who fund their own claims. For more specific information about supervision of the Treasury Management Fund.
• Specialised insurers are funded by employers within a specific industry.
• Self-insurers fund and manage their own workers compensation claims.

Principal objectives of insurer supervision

SIRA regulates insurers to:

• promote the efficiency and viability of the workers compensation scheme
• minimise cost to the community of workplace injuries
• promote workplace injury prevention and effective injury management and return to work measures and programs
• ensure that workers injured have access to treatment to assist with their recovery
• provide effective supervision of claims handling and disputes
• promote compliance with the workers compensation legislation.

To do this SIRA regulates workers compensation insurers in accordance with:

• State Insurance and Care Governance Act 2015
• Workers Compensation Act 1987
• Workplace Injury Management and Worker Compensation Act 1998
• Workers Compensation Regulation 2016
• Workers Compensation Guidelines
• Market practice and premiums guidelines
• Insurer data requirements
• Licensed insurer business plan guidelines
• Claims management guide (CMG) and standards of practice
• Workers compensation benefits guide

Notifying SIRA about a significant matter

SIRA requires the timely and transparent notification of significant matters from workers compensation insurers.

Claims management audits

Insurers are required to undertake a claims management self-audit at least once every financial year in accordance with the SIRA claims management audit manual.

SIRA may also conduct an audit of an insurer under s202A of the 1987 Act at its discretion. These audits may be conducted in accordance with the SIRA claims management audit manual or may also audit additional criteria not contained in the manual as dependent upon the circumstances leading to the audit.

The following documents outline the audit process and procedures to be used by SIRA when conducting a claims management audit and are to be used by insurers when conducting a claims management self-audit.

• SIRA Claims management audit manual
• SIRA Insurer claims management audit guide
• Audit tool
• Audit report template
• Audit improvement plan

Annual information requirements

Section 189 of the 1987 Act sets out the information and records that are to be supplied to SIRA. These requirements are clarified in SIRA’s Self-insurer s189 business information requirements.

The following information is to be supplied within four months of the end of an insurer’s financial year:

• Business information including key contacts and organisational structure.
• Annual report and audited financial statements.
• Actuarial outstanding liability valuation report.
• Reinsurance policy information.
• Business plan for the upcoming financial year.