Commonwealth Numbered Acts

PRIVATE HEALTH INSURANCE (PRUDENTIAL SUPERVISION) ACT 2015 (NO. 85, 2015) - SECT 28

Assets of health benefits funds not to be applied or dealt with except in accordance with this Division

             (1)  A private health insurer must not apply, or deal with, assets of a health benefits fund, whether directly or indirectly, except in accordance with this Division.

Application of assets: general rules

             (2)  The assets of a health benefits fund must not be applied:

                     (a)  for any purpose other than:

                              (i)  meeting policy liabilities and other liabilities, or expenses, incurred for the purposes of the business of the fund including policy liabilities and other liabilities that are treated, in accordance with a restructure or arrangement approved under Division 4, as policy liabilities and other liabilities incurred for the purposes of the fund; or

                             (ii)  making investments in accordance with section 30; or

                            (iii)  making a distribution under Division 5; or

                            (iv)  a purpose specified in APRA rules made for the purpose of this subparagraph; or

                     (b)  for a purpose specified in APRA rules made for the purpose of this paragraph.

Mortgaging or charging assets

             (3)  A private health insurer must not mortgage or charge any of the assets of a health benefits fund except:

                     (a)  to secure an overdraft from an ADI; or

                     (b)  for such other purposes, and subject to such conditions, as are specified in APRA rules made for the purpose of this paragraph.

Borrowing money

             (4)  A private health insurer must not borrow money for the purposes of the business of a health benefits fund except in accordance with APRA rules made for the purpose of this subsection.

Application of assets: for profit insurers

             (5)  Despite subsection (2), if a private health insurer is a for profit insurer, the assets of a health benefits fund conducted by the insurer may be applied for any purpose, except an application of the assets that is inconsistent with:

                     (a)  prudential standards relating to capital adequacy or solvency that apply in relation to the fund; or

                     (b)  a direction given to the insurer under section 96 that relates to the fund.

Section does not apply to certain transfers of assets

             (6)  This section does not apply to the transfer of assets:

                     (a)  from one health benefits fund to another in accordance with a restructure or arrangement approved under Division 4; or

                     (b)  in accordance with a direction under subsection 25(2).