APRA intends to implement its changes to life insurance data, and will announce what data is to be made non-confidential in the third quarter of 2013.
The move comes despite strong opposition from Abacus and Friendly Societies of Australia (FSA). FSA said that by removing confidentiality protection, APRA will be able to publish complete datasets, including individual entity data, and APRA’s capacity to decline FOI requests for release of the data will be reduced.
“FSA is concerned that this could result in an environment where hostile takeovers could become a more significant risk for friendly societies,” said Abacus senior adviser of policy & public affairs, James Aliferis. Aliferis expressed concern about what would happen to competition within the industry.
“In a slow growth or depressed market, underperforming friendly societies could also be more easily identified. This poses a stability concern about the possible flight of funds, and prospective clients, to other institutions.”
Hanover Life also raised the issue of competition, saying the move would create a competitive disadvantage to specialist, smaller and newer insurers.
“For a specialist or smaller insurer that, for example, only writes products of a particular type or of a limited range of types within a particular APRA product group, the proposal would result in detailed information on business volumes and financial results becoming publicly available for that product type or types for that insurer.
“As a result, we submit that the proposal would disclose confidential information and would thus result in an inappropriate competitive disadvantage for specialist and smaller insurers.”
Hanover Life said that by creating a disadvantage for smaller and newer insurance companies, the likely effect would be consolidation of market share within the larger insurers and a resultant lessening of effective competition within the industry.
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