The Reserve Bank is opening the door for feedback on sweeping changes to how New Zealand’s insurance sector is regulated, with a new consultation on proposed reforms to the Insurance Prudential Supervision Act.
The draft changes are part of a long-running review aimed at modernising the country’s insurance laws, which have been in place since 2010. The Reserve Bank says the current framework needs updating to better reflect global standards and strengthen oversight of insurers.
The proposed overhaul would give the central bank broader powers to supervise insurers, including the ability to set enforceable standards, carry out more intensive monitoring, and step in earlier when companies show signs of financial stress.
Changes under consideration also include stricter rules around who can run insurance companies, expanded enforcement tools, and updated processes for dealing with firms in financial trouble.
The consultation marks a key step before legislation is introduced to Parliament, with the draft amendment bill expected to shape how insurers operate for years to come.
The reforms are designed to ensure insurers remain financially sound and able to meet claims, while also improving public confidence in the sector and aligning New Zealand more closely with international best practice.
Industry players and stakeholders are now being encouraged to have their say, with feedback set to inform the final shape of the legislation before it is formally introduced.
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