The key aspects of these reforms include:
- Aligning capital settings more closely with the long-term nature of longevity liabilities.
- Enhancing capital efficiency for providers of longevity products.
- Creating a more proportionate and risk-sensitive framework for capital requirements.
To assist insurers in implementing these changes, APRA has released a reporting template for those opting to use the annuity investment-linked product. Feedback on this template is invited until 12 May 2026.
These reforms are expected to encourage the development of more diverse and innovative retirement income products, offering Australian retirees greater flexibility and security in managing their post-retirement finances.
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