ASIC today published its Corporate Plan for 2020-24, which sets out how we aim to achieve our vision through our strategic priorities and actions over the next four years.
August 31, 2020 | AtoZ Markets – The Australian and Securities Investments Commission (ASIC) has outlined areas in insurance they intend to focus on between now and 2024.
ASIC Corporate Plan will focus on the coronavirus pandemic
The Corporate Plan outlines actions ASIC is taking to address the impact of the COVID-19 pandemic as well as longer-term threats and harms in their regulatory environment. A key consideration in all their work is the extent to which they are supporting the long term recovery of the Australian economy.
ASIC’s move to address the COVID-19 pandemic is, however, guided by five strategic priorities:
- protecting consumers from harm at a time of heightened vulnerability;
- maintaining financial system resilience and stability;
- supporting Australian businesses to respond to the effects of the COVID-19 pandemic;
- continuing to identify, disrupt and take enforcement action against the most harmful conduct; and
- continuing to build our organizational capacity in challenging times.
ASIC longer-term focus areas
ASIC is also committed to other important priorities and workstreams beyond its pandemic-related activities. The regulator’s longer term focus areas include:
- promoting confident participation in the financial system to support long term economic recovery
- deterring poor behavior and misconduct through our ‘Why not litigate?’ discipline and driving cultural change using all of our regulatory tools;
- improving entities’ management of key risks to prevent and mitigate harms to consumers and promote a healthy financial system and economic growth;
- addressing consumer harm as a result of elevated debt levels and hardship, with a particular focus on predatory lending;
- reducing poor product design and restricting mis-selling;
- reducing misconduct by company directors and professional service providers; and
- delivering as a conduct regulator for superannuation.
“Our core purpose is to ensure confidence in a financial system that, even under stress, can remain fair, strong and efficient. Confidence is the bedrock of the economic recovery process,’ said ASIC’s Chair, James Shipton. ‘This is the purpose of all our work, both in the immediate context of the pandemic and beyond it. We will continue to respond rapidly and strategically to the threats arising in an uncertain environment.“
ASIC makes executive changes
Moreover, to assist in executing this plan ASIC has made two senior organizational changes:
Warren Day, formerly Executive Director, Assessment and Intelligence, has transitioned to the role of Chief Operating Officer. Also, the position of Chief Risk Officer has been established and Zack Gurdon has been appointed to this key role.
APRA Corporate Plan
The Australian Prudential Regulation Authority (APRA) has also outlined areas in insurance they intend to focus on between now and 2024. APRA’s Corporate Plan says it will continue to focus on key risk areas. These include capital and the sustainability of insurance products.
The prudential regulator says the industry has incurred a “particularly severe level” of claims arising from a series of natural disasters before the pandemic erupted, adding more strain on the industry.
“Whilst the events so far have impacted earnings rather than capital, there remains significant future risk of decreased business volumes, increased claims activity and more expensive reinsurance,” APRA said.
“The ultimate claims impact of COVID-19 is likely to remain uncertain for some time given the prospect of litigation across multiple classes of business (most prominently in business interruption insurance) and with further potential concerns arising in regard to the future availability and affordability of particular classes of insurance more broadly.
“However, in the face of these challenges, the general insurance industry continues to be resilient and well-capitalized.”
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