LICENSING AND REGULATION
Friendly societies are usually licensed financial institutions which are prudentially regulated by the Australian Prudential Regulation Authority (APRA) and the Life Insurance Act 1995. Friendly societies products are also subject to regulation by the Australian Securities and Investments Commission (ASIC) because friendly societies have disclosure and financial services licensing obligations under the Corporations Act 2001. This means friendly societies are held to the same standards as banks.
All APRA-regulated friendly societies are registered as life insurance companies under the Life Insurance Act, which authorises friendly societies to conduct various classes of life insurance business structured within their corporate entity using the friendly society “benefit fund” structure.
Friendly societies and co-operatives have always been subject to different legislation to other financial services organisations as most meaningful co-operatives are distributing mutual entities.