New Zealand central bank issues interim solvency standards for insurers

The interim standards will come into force on 1 January 2023.

The Reserve Bank of New Zealand (RBNZ) has today issued its Interim Solvency Standard, informed by two years of planning and consultation with the insurance industry and other interested parties.

In mid-2020, the RBNZ, which is responsible for the regulation of New Zealand’s insurance sector started a review of the existing suite of insurance solvency standards mid-2020, in part to address the new accounting standard for insurance contracts.

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The solvency standards are being reviewed alongside the Insurance (Prudential Supervision) Act 2010 (IPSA) - the primary legislation that empowers regulation and supervision.

The interim standard comes into force on 1 January 2023 and will be applied to individual non-exempt insurers at various times in 2023 by changes to their condition of licence. Insurers should now begin using this standard in their projections.