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In a letter sent to chief executives of the insurers, the regulators said the “nature and extent of the issues within financial services in Australia and the obvious cross-over in terms of entities, people and practices into New Zealand demands a strong response from the industry here, and from the regulators.”
The regulators said views pertaining to life insurance providers were discussed during a recent meeting between them and the board of the Financial Service Council. Now, they want to understand what work life insurers have undertaken to review their operations and identify and address any conduct and culture issues.
“We expect you to show us what you have done in order to be comfortable that there are no material conduct issues within your business,” the regulators said. “We anticipate that you will be familiar with our Conduct Guide (published in February 2017) and maybe extending or enhancing your work in response to the guide as it intersects with issues raised at the Royal Commission.
“There may also be issues you are looking at more broadly as a result of that inquiry,” they added.
Earlier in May, FMA and the RBNZ also sent a letter to licensed banks demanding proof that consumers, regulators and other stakeholders can have full confidence in the financial services industry in New Zealand.
In the letter to life insurers, the regulators said they want a written summary response from the organisations outlining how they have addressed the issues and themes arising from the Royal Commission.
“We will then assess this summary information and schedule a follow-up meeting with your core team to discuss your response, agree next steps, timetable, further information requests and ongoing reporting,” they added. “We will also work with you to schedule a meeting with your board of directors to discuss this work as appropriate.”
The life insurers have until June 22 to submit their responses.
