INSURANCE ACT 1973 - SECT 62ZI Report by judicial manager

INSURANCE ACT 1973 - SECT 62ZI

  (1)   As soon as possible after starting to manage a general insurer, a judicial manager must file with the Federal Court a report that:

  (a)   recommends the course of action listed in subsection   (2) that is, in his or her opinion, most advantageous to the general interest of the policyholders of the general insurer while promoting financial system stability in Australia; and

  (b)   sets out the reasons for that recommendation.

  (2)   The following are the possible courses of action:

  (a)   to transfer the business of the general insurer to another general insurer under Division   3A of Part   III (whether the policies issued by the general insurer continue for the original sums insured, with the addition of bonuses that attach to the policies, or for reduced amounts);

  (aa)   to transfer the business, or part of the business, of the company to another company under section   25 of the Financial Sector (Transfer and Restructure) Act 1999 ;

  (ab)   to transfer shares in the company to another company under section   25AA of the Financial Sector (Transfer and Restructure) Act 1999 ;

  (b)   to allow the general insurer to carry on its business after a period of judicial management (whether the policies issued by the general insurer continue for the original sums insured, with the addition of bonuses that attach to the policies, or for reduced amounts);

  (c)   to do one or more of the acts described in subsection   62Z(1) (which is about various measures to recapitalise the general insurer), if that subsection applies to the general insurer;

  (d)   to wind up the general insurer;

  (e)   to take such other course of action as the judicial manager considers desirable, which may, for example, be a course of action that includes either or both of the following:

  (i)   altering the constitution, rules or other arrangements for governance of the general insurer, if it is registered under the Corporations Act 2001 , to enable or facilitate the performance of the judicial manager's functions and duties, the exercise of the judicial manager's powers or a course of action described in paragraph   (a), (b), (c) or (d);

  (ii)   one or more of the courses of action described in paragraphs   (a), (b), (c) and (d).

  (3)   A report may recommend different courses of action in respect of different parts of a general insurer's business.

  (4)   If the Federal Court makes an order under section   62ZJ giving effect to a course or courses referred to in paragraph   (2)(a), (b), (c) or (e) of this section, the judicial manager may file with the Court a further report or further reports dealing with matters to which a report under subsection   (1) of this section may relate.

  (5)   A report under subsection   (4) must set out the reasons for any recommendation made in the report.

  (6)   As soon as possible after filing a report under this section, the judicial manager must:

  (a)   give a copy of it to APRA; and

  (b)   apply to the Federal Court for an order to give effect to the course or courses of action stated in the report.

  (7)   A report, or a copy of a report, under this section must be available for inspection by any person:

  (a)   at the Registry of the Federal Court in which the report is filed during the business hours of that Registry; and

  (b)   at such other place (if any) as APRA determines.