Page 47 - Suncorp

Insurance risk

The risk of fnancial loss and the inability to meet liabilities due to inadequate or inappropriate insurance product design, pricing, underwriting, concentration risk, reserving, claims management or reinsurance management. Insurance risk arises in General Insurance and Life due to risks relating to the uncertainty of cash fows from insurance contracts.

Operational risk

The risk of loss resulting from inadequate or failed internal processes, people and systems or from external events. These include internal and external fraud, system failure, natural disasters, business interruption, risks associated with business practices, vendors, suppliers, service providers, employment practices and workplace safety.

Compliance risk

The risk of legal or regulatory sanctions, fnancial loss or reputational damage the Suncorp Group may suffer as a result of its failure to comply with all applicable laws, regulations, codes of conduct and good practice standards.

Strategic risk

The risk of loss arising from uncertainty about the future operating environment, including reputation, industry, economic and regulatory environment, branding, crisis management, alliances and suppliers. Strategic risks relate to the Suncorp Group’s business strategy and tactical initiatives that are articulated in business plans.

Within the enterprise risk management framework, an accountabilities model clearly establishes roles and responsibilities for managing risk. The Management Risk Committees are an important part of the accountabilities model with a number of committees in place. These committees comprise executive representation from both Suncorp Group and Line of Business as appropriate. A subset of these committees operate with Board Risk Committee-approved charters, delegations and limits. Current key management committees include: –– Group Asset & Liability Committee –– Bank Credit Risk Committee –– Bank Asset & Liability Committee –– Bank Operational Risk Committee –– Suncorp Life Asset & Liability Committee –– Suncorp Life Operational Risk Committee –– Suncorp Life Breach Committee

–– General Insurance Asset & Liability Committee –– General Insurance Risk & Governance Committee –– General Insurance Breach Committee –– Crisis Management Team

–– Vero New Zealand Asset & Liability Committee –– Vero New Zealand Risk & Governance Committee

As part of the risk management framework, internal controls have been implemented across the Suncorp Group to ensure appropriate risk identifcation, assessment, control, management, monitoring and reporting. This section outlines some of the key elements of those internal controls.

The Suncorp Group Compliance Policy mandates the Suncorp Group will conduct its business in compliance with all laws, rules, regulations, standards and codes, internal policies and procedures. To ensure this occurs, senior management completes a monthly automated due diligence questionnaire to report the Suncorp Group’s regulatory and operational compliance status, including both actual and potential breaches. All matters identifed within the due diligence report are retained on each subsequent monthly report until the matter is resolved to the satisfaction of management, a Board committee, or the Board itself, depending on the circumstances.

Policies and procedures have been developed to also ensure open communications occur between the Suncorp Group and its primary regulators in a timely manner, namely: –– that all material correspondence between the Suncorp Group and regulators is referred to the Board or relevant Board committee; and

–– that the Suncorp Group notify ASIC and APRA of any reportable breaches.

Page 47 - Suncorp_Review

Page 47 - Suncorp_Review