Circulars

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General PHIAC Circulars

SBA Circulars

General PHIAC Circulars

Form of Statements by Directors in Relation to Capital Adequacy Margin, Loss Ratio Risk Management Procedures

A. Capital Adequacy Margin

"The Board of [private health insurer], at a meeting held on [Date], after consideration of the qualitative factors specified by Clause 13 of Schedule 3 of the Private Health Insurance (Health Benefits Fund Administration) Rules 2007, resolved that the capital adequacy margin of [x]% is an appropriate margin for risk for the purposes of the preparation of the PHIAC Annual Return for [insurer] for the year ended 30 June 2008"

B. Loss Ratio

"The Board of [private health insurer], at a meeting held on [Date], after consideration of the qualitative factors specified by Subclause 19 (3) of Schedule 2 of the Private Health Insurance (Health Benefits Fund Administration) Rules 2007, resolved that the loss ratio of [x]% is a suitable alternative ratio for the purposes of the preparation of the PHIAC Annual Return for [insurer] for the year ended 30 June 2008."

C. Risk Management Processes

We, in our capacity as Directors of (private health insurer) certify that:

• The insurer has referred to the Australian Standard for Risk Management (AS/NZS 4360) as an accepted measure of appropriate risk management processes;

• The Board has approved the risk management system in place, and understands its contents;

• The risk management system in place has been formulated from a framework for establishing the context, identification, analysis, evaluation, treatment, monitoring and communication of risk;

• The system in place includes comprehensive written policies and procedures and adequate control systems to measure, monitor and manage risk;

• The Board has reviewed the policies and procedures, at least annually, to assess their implementation, effectiveness, and to endorse them;

• The Board receives regular reports on the operation of the risk management system and is satisfied with the level of adherence to those policies and procedures;

• The Board has ensured that there has been, at all times, appropriate Director’s and Officer’s (D&O) insurance cover in place;

• This statement is made in accordance with a resolution of Directors; and

• The information provided is true and correct. I am aware that the giving of false or misleading information, documents or statements to the Private Health Insurance Administration Council is a serious offence under the Commonwealth's Criminal Code Act 1995 and that the Criminal Code Act imposes substantial penalties, including imprisonment, for committing these offences.

I, [name] certify on behalf [name of private health insurer] that:

(a) the accounts and statements bearing this certification are true and correct; and

(b) I have the authority of [name of private health insurer] to make this certification.

………………………………………………………..

Certifier 1

………………………………………………………..

Date of certification

I, [name] certify on behalf [name of private health insurer] that:

(a) the accounts and statements bearing this certification are true and correct; and

(b) I have the authority of [name of private health insurer] to make this certification.

………………………………………………………..

Certifier 2

………………………………………………………..

Date of certification

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Private Health Insurance Administration Council

Suite 16, Level 1, 71 Leichhardt Street, KINGSTON ACT 2604
Telephone 02 6215 7900 | Facsimile 02 6215 7977 | Email phiac@phiac.gov.au

Last modified: 25 June, 2008