Legal and regulatory update for the life and health insurance sector

3 May 2021 – Government announced that the Productivity Commission will hold an inquiry into immigration settings to ensure New Zealand’s long term prosperity and wellbeing. Relevant web links are https://www.beehive.govt.nz/release/productivity-commission-inquiry-immigration-settings and https://www.productivity.govt.nz/news/inquiry-into-new-zealands-immigration-settings-confirmed/

4 May 2021 – The New Zealand Superannuation and Retirement Income (Fair Residency) Amendment Bill, which proposes to raise the minimum residency qualification for New Zealand Superannuation from 10 years to 20 years after age 20, was reported back to Parliament from the Select Committee. https://www.parliament.nz/en/pb/bills-and-laws/bills-proposed-laws/document/BILL_80767/new-zealand-superannuation-and-retirement-income-fair

5 May 2021 – RBNZ released the May 2021 Financial Stability Report together with an updated Capital Review Implementation timeline. https://www.rbnz.govt.nz/news/2021/05/financial-system-sound-but-vulnerabilities-remain


Legal and regulatory review for the life and health insurance sector

29 Apr 2021 – The international Financial Action Task Force released its latest Mutual Evaluation Report on New Zealand’s Anti-money Laundering and Counter-terrorist Financing Measures. https://www.fatf-gafi.org/publications/mutualevaluations/documents/mer-new-zealand-2021.html

29 Apr 2021 – The IRD released the corrected Special report on the Taxation (Annual Rates for 2020–21, Feasibility Expenditure, and Remedial Matters) Act 2021. https://taxpolicy.ird.govt.nz/publications/2021/2021-sr-arferm-act

30 Apr 2021 - Minister of Commerce and Consumer Affairs, Hon David Clark, March 2021 diary released with the following potential financial services sector related meetings noted:

  • 3 Mar 2021 – ASB (Vittoria Short, CE & Gavin Walker, Chair)
  • 3 Mar 2021 – Banking Ombudsman Event (Video conference – various attendees not listed)
  • 8 Mar 2021 – Payments NZ (Steve Wiggins, Chief Executive, Jane Retimana, GM Strategy and Corporate Affairs, Jamie Wood, Manager Clearing Systems, Sarah Hensen, General Counsel and Company Secretary)
  • 9 Mar 2021 - FinCap and NZBA Event (Speaking)
  • 11 Mar 2021 – IAG (Bryce Davies, Executive Manager Corporate Relations)
  • 17 Mar 2021 – Farmers Mutual Group (FMG) (Chris Black, CE, Dave Kibblewhite, Chief Financial, Investment & Risk Officer and Lisa Murray, Head of Compliance, Risk Quality, and General Counsel FMG)
  • 17 Mar 2021 – Financial Services Federation General Meeting (Speaking)
  • 17 Mar 2021 – Suncorp (David Flacks, Chair, Jimmy Higgins, CE, Suncorp NZ; Chris Curtain, CE, AA Insurance; Adrian Tulloch, MD Vero Liability Insurance, Hon Clayton Cosgrove)
  • 18 Mar 2021 – Tower Insurance (Blair Turnbull - CEO)
  • 24 Mar 2021 – ANZ (Sir John Key, Chair, Antonia Watson, CEO)
  • 24 Mar 2021 – BNZ (Doug McKay, Chair, Angela Mentis CE BNZ)
  • 24 Mar 2021 – Ando Insurance (John Lyon, CE Ando Insurance)
  • 24 Mar 2021 – Commission for Financial Capability (Jane Wrightson, Retirement Commissioner)
  • 30 Mar 2021 – Financial Markets Authority (FMA Chair, CE)
  • 30 Mar 2021 – Financial Markets Authority Board (FMA Board)
  • 31 Mar 2021 – Christians Against Poverty (Sam Garaway, CE, Francis Okapaleke, External Engagement Manager)
  • 31 Mar 2021 – Kiwibank (Steve Jurkovich, CE)
  • 31 Mar 2021 – Westpac (CE David McLean; Chair: Jon Dawson)

Weblink to the diary release https://www.beehive.govt.nz/sites/default/files/2021-04/Hon%20Dr%20David%20Clark%20Proactive%20Diary%20Release%20March%202021_0.pdf

28 Apr 2021 – Privacy Commissioner published commentary on its website titled, “That was close! How to respond when you narrowly avoid a serious privacy breach.” https://privacy.org.nz/blog/how-to-respond-privacy-breach/

29 Apr 2021 – RBNZ announced that the RBNZ has joined the Bank of Canada and the Reserve Bank of Australia forming a voluntary network to foster ongoing dialogue and raise awareness of Indigenous economic and financial issues. https://www.rbnz.govt.nz/news/2021/04/te-putea-matua-becomes-inaugural-member-of-new-international-central-bank-network

29 Apr 2021 – Treasury and the Ministry of Housing and Urban Development (HUD) proactively released Cabinet material and advice relating to the Government’s Housing Package announced on 23 March 2021. https://www.treasury.govt.nz/news-and-events/news/housing-package-proactive-release


RBNZ reveals cyber resilience guidance, and more daily news

RBNZ has revealed that the cyber resilience guidance for regulated entities has been finalised. The guide outlines cyber resilience expectations for all entities regulated by the RBNZ. International and national cybersecurity standards were used to create the guide. The guide is designed to raise awareness and promote cyber resilience of the financial sector, with a focus on the board and senior management level of all regulated entities. RBNZ has said that the guide provides high-level principle-based recommendations for entities and is intended to be used as an overarching framework for governance and management of cyber risk. The guide can be tailored to meet the specific needs and technologies of entities.

“The Reserve Bank – Te Pūtea Matua has finalised its guidance on what regulated entities should consider when building their cyber resilience.

The guidance outlines the Reserve Bank’s expectations around cyber resilience, and draws heavily from leading international and national cybersecurity standards and guidelines. The guidance applies to all entities the Reserve Bank regulates, including registered banks, licensed non-bank deposit takers, licensed insurers and designated financial market infrastructures

The finalised guidance on cyber resilience aims to raise awareness of, and ultimately promote, the cyber resilience of the financial sector, especially at the board and senior management level of regulated entities.

The guidance provides high-level principle-based recommendations for entities and primarily serves as an overarching framework for the governance and management of cyber risk, which entities can tailor to their own specific needs and technologies, rather than as an explicitly detailed or technical set of instructions.

The intention is to illustrate current best practice and encourage continual improvement beyond these practices into all areas where entities can further strengthen their cyber resilience.” Click here to read more

In other news

From Stuff: Waiting in Pain: People without money and insurance the ones who suffer

From ThinkAdvisor: Life Coverage Gap Grows: 2021 Insurance Barometer Study

 


Legal and regulatory update for the life and health insurance sector

28 Apr 2021 – RBNZ published its guidance on what regulated entities should consider when building their cyber resilience - given their recent experience, and I mean this, the guidance is likely to be a fair reflection of their own practice and current approach. A high level guide for supervised organisations. https://www.rbnz.govt.nz/news/2021/04/reserve-bank-publishes-cyber-resilience-guidance


Legal and regulatory review for the life and health insurance sector

22 Apr 2021 – ASIC released its set of expectations of life and general insurers following a review of insurers’ responses to consumers experiencing financial hardship during the COVID-19 pandemic. This and vulnerable client issues are likely to be covered by the FMA over the course of the year so these expectations are well worth reviewing. https://asic.gov.au/about-asic/news-centre/news-items/asic-sets-expectations-of-life-and-general-insurers-following-a-review-of-insurers-responses-to-consumers-experiencing-financial-hardship-during-the-covid-19-pandemic/

22 Apr 2021 – Department of Internal Affairs released its AML/CFT Regulatory Findings Report 2020 together with its targeted compliance assessment on reporting entities’ policies, procedures and controls for relating to politically exposed persons (PEPs). Weblinks follow:

https://www.dia.govt.nz/AML-CFT-Regulatory-Findings-Report-2020-available and https://www.dia.govt.nz/AML-CFT-Targeted-Compliance-Assessments

22 Apr 2021 – Government, Treasury and the RBNZ advised that a Cabinet decision to adopt the final measures resulting from the Reserve Bank Act Review will see drafting commence for new legislation to be known as the Deposit Takers Act. This Act will create a single regulatory regime for all bank and non-bank deposit takers (such as building societies and finance companies). It will also introduce a new deposit insurance scheme that will protect up to $100,000 per depositor, per institution in the event of a failure. Relevant weblinks follow:

https://www.beehive.govt.nz/release/deposit-taking-measures-protect-financial-stability-and-new-zealanders

https://www.rbnz.govt.nz/news/2021/04/new-deposit-takers-act-a-step-closer

https://www.nzba.org.nz/2021/04/22/deposit-guarantee-scheme-provides-extra-security-for-depositors/


Legal and regulatory update for the life and health insurance sector

15 Apr 2021 – The Law Commission is seeking feedback on its review of succession law, with submissions closing on 10 June 2021. https://www.lawcom.govt.nz/media-release/law-commission-proposes-changes-succession-law

15 Apr 2021 – RBNZ released a paper titled “An Overview of Māori Financial Services Institutions and Arrangements.” https://www.rbnz.govt.nz/research-and-publications/discussion-papers/2021/dp2021-03

15 Apr 2021 - Financial Sector (Climate-related Disclosures and Other Matters) Amendment Bill underwent first reading and referred to the Economic Development, Science and Innovation Parliamentary Select Committee, to be reported in 4 months and 1 day. https://www.parliament.nz/en/pb/bills-and-laws/bills-proposed-laws/document/BILL_109905/financial-sector-climate-related-disclosures-and-other

15 Apr 2021 – NZ Markets Disciplinary Tribunal released its Annual Report 2020. https://www.nzx.com/announcements/370794


FMA remind advisers to link with FAPs, and more daily news

The FMA has reminded all financial advisers that they must link to the FAP that they are operating under. The FMA has noted that linking on the FSPR is a critical step in the new regime. This step must be completed before advisers provide advice to clients. Advisers that haven’t linked to their FAPs by 16 June 2021 may face deregistration.

“Financial advisers are being reminded to check their Financial Advice Provider has linked to them on the Financial Service Providers Register (FSPR).

This is a critical step under the new financial advice regime and must be completed before advisers offer advice to retail clients.

Advisers not shown as linked to a licensed Financial Advice Provider, or authorised body by 16 June this year may face deregistration if they offer no other services.

You can see full details of how to complete the linking process on the FSPR in this video guide and on the Companies Office website.”

In other news

Fidelity Life: Currently vacant Chief Distribution Officer (CDO) role has been renamed Chief Sales & Service Officer (CSSO). The role will include overseeing the application, renewal and service components of the customer journey.

Fidelity Life: Information on the new commission model and distribution agreements is set to be shared in the near future

Fidelity Life: Advisers are expected to complete their accreditation before June 2021 to continue to work with their agency

Fidelity Life: My Story - David and Cheri

RBNZ: Discussion Paper Advisory: Māori Financial Services Institutions and Arrangements

From LinkedIn: Advisers should lead from the front on climate disclosure


Legal and regulatory update for the life and health insurance sector

12 Apr 2021 – RBNZ advised that it is ceasing to publish certain weekly banking customer lending metrics, as it also resumes publishing certain insurance financial statistics. https://www.rbnz.govt.nz/statistics/statistics-news-and-updates

12-13 Apr 2021 - Financial Sector (Climate-related Disclosures and Other Matters) Amendment bill introduced into Parliament, intended to amend the Financial Markets Conduct Act 2013, the Financial Reporting Act 2013, and the Public Audit Act 2001 by implementing a single broad policy to broaden non-financial reporting by requiring and supporting the making of climate-related disclosures by certain FMC reporting entities and supporting related matters. Relevant web links are https://www.parliament.nz/en/pb/bills-and-laws/bills-proposed-laws/document/BILL_109905/financial-sector-climate-related-disclosures-and-other and https://www.beehive.govt.nz/release/nz-becomes-first-world-climate-reporting

13 Apr 2021 – FMA provided a breakdown of financial advice providers in the new regime. https://www.fma.govt.nz/news-and-resources/media-releases/breakdown-fa-providers/

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13 Apr 2021 – RBNZ announced the establishment of a new standalone Enforcement Department to promote confidence in compliance across regulated sectors. The Enforcement Department is operationally separate from the Bank’s Supervision team, but the two will work closely together to achieve the Bank’s compliance goals. https://mailchi.mp/rbnz.govt.nz/reserve-bank-launches-new-enforcement-department?e=1769bcd465


Legal and regulatory review for the life and health insurance sector

31 Mar 2021 – RBNZ advised via -email that it had published updated versions of the ‘working copies’ of the bank disclosure Orders in Council (OICs) that it maintains on its website.

31 Mar 2021 - Minister of Commerce and Consumer Affairs, Hon David Clark, February 2021 diary released with the following potential financial services sector related meetings noted:

  • 10 Feb 2021 – Speaking at the Financial Services Council (FSC) Get In Shape Summit
  • 12 Feb 2021 – Meeting with Forsyth Barr (Ken Lister and Trish Oakley)
  • 18 Feb 2021 – Insurance Council of NZ (Craig Olsen, President, Chris Curtin, Vice President, Tim Grafton, CE, and Board Members)
  • 24 Feb 2021 - Meeting with Asia Pacific MasterCard (Ruth Riviere, Country Manager, Peter Chisnell, Senior Vice President Market Development for Asia Pacific MasterCard)
  • 24 Feb 2021 – Meeting with Visa International (David O’Brien, Head of Merchant Sales and Solutions NZ & South Pacific, Marty Kerr, Country Manager, NZ & South Pacific for Visa International)
  • 25 Feb 2021 – KiwiSaver Announcement (Various attendees not listed)
  • 25 Feb 2021 – Meeting with Financial Services Council (Rob Flanagan, Chair, Richard Klipin, CEO, Thomas Pryor)
  • 25 Feb 2021 – Meeting with Financial dispute resolution schemes (CEO - Financial Services Complaints Ltd, General Manager - Fairway Resolution, Banking Ombudsman, Insurance and Financial Services Ombudsman, Board member of IFSO)

https://www.beehive.govt.nz/sites/default/files/2021-03/Hon%20Dr%20David%20Clark%20Proactive%20Diary%20Release%20February%202021.pdf


Legal and regulatory update for the life and health insurance sector

31 Mar 2021 – RBNZ announced that it is easing the dividend restrictions placed on retail banks at the height of the COVID-19 pandemic, allowing banks to pay up to a maximum of 50% of their earnings as dividends to their shareholders. The 50% dividend restriction will remain in place until 1 July 2022, at which point the Reserve Bank intends to normalise the dividend settings by removing the restrictions entirely (subject to no significant worsening in economic conditions). https://www.rbnz.govt.nz/news/2021/03/reserve-bank-retains-some-dividend-restrictions-and-expects-banks-to-be-prudent