Regulatory AlertsPrudential Standard LPS 340 Valuation of Policy Liabilities
The Australian Prudential Regulation Authority issued Prudential Standard LPS 340 to mandate how life insurers and friendly societies calculate policy liabilities under the Life Insurance Act 1995. The standard requires companies to classify business into specific categories and perform separate valuations for each approved benefit fund, statutory fund, and business class. It prescribes distinct valuation methods for non-participating and participating business, while establishing a uniform Best Estimate Liability calculation for all life insurance policies.
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