Auto & General hit with AU$50m capital blow in APRA’s risk crackdown

The company has accepted the findings and committed to the remediation programme.

APRA has mandated Auto & General Insurance to address significant weaknesses in risk governance, management, and compliance. 

Identified issues include deficiencies in the risk function, ineffectiveness of the "three lines of defence" model, weak risk reporting, unclear accountabilities, and an immature risk culture. 

Auto & General must conduct a root cause analysis, implement an APRA-approved remediation program, and have it independently assured. 

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Due to heightened prudential risk, APRA imposes an additional AU$50m ($33.1m) capital requirement effective from 1 February, until concerns are resolved. Auto & General has accepted the findings and committed to the remediation programme. 

APRA stresses the importance of insurers meeting regulatory obligations for consumer confidence and financial stability.

(AU$1.00 = $0.66)