Liberty Mutual Insurance Company, Australia Branch (Liberty Australia) operates as a branch of Liberty Mutual Insurance Company. Prudential Standard CPS 511 Remuneration (CPS 511) sets out disclosure requirements designed to enhance transparency of remuneration practices across APRA-regulated entities, including the public disclosure of information relating to remuneration frameworks, design, governance and outcomes.
Liberty Australia is classified as a non-significant financial institution (non-SFI) for the purposes of CPS 511. This disclosure is provided in accordance with APRA Prudential Standard CPS 511 Remuneration and outlines Liberty Australia’s remuneration framework and practices for the financial year ended 31 December 2025.
This disclosure should be read in conjunction with Liberty Australia’s Remuneration Policy.
Governance
Liberty Australia’s remuneration framework operates within a global governance structure, supported by Liberty Mutual Group and regional oversight.
The Senior Officer outside Australia (SOoA) has primary responsibility for remuneration governance in Australia and is supported by global governance bodies, including the Liberty Mutual Group Compensation Committee, as well as local Human Resources leadership. The SOoA reviews and approves remuneration policy settings and outcomes, ensuring alignment with regulatory requirements, including CPS 511 and the Financial Accountability Regime. Remuneration governance processes are conducted regularly to ensure appropriate oversight, challenge, and approval of remuneration outcomes.
Remuneration matters are considered through regular governance processes, with two meetings held during the financial year.
Exercise of Discretion
The SOoA exercises discretion in determining remuneration outcomes and may:
- adjust variable remuneration outcomes (including to zero);
- apply in-period adjustments, malus or clawback;
- respond to risk, conduct and compliance outcomes; and
- address any unintended consequences impacting financial soundness.
Role of Risk and Control Functions
The SOoA considers input from the Chief Risk Officer and other control functions, including Risk, Compliance, Legal and Human Resources, when assessing remuneration outcomes to ensure alignment with risk and conduct performance.
Design and structure
Liberty Australia’s remuneration framework is designed to support its business strategy, risk management framework, and long-term financial soundness.
The framework promotes a risk-aware culture and reinforces behaviours consistent with Liberty Australia’s Risk Appetite Statement. It also supports the management of both financial and non-financial risks, sustainable performance, and the mitigation of conduct risk.
Total remuneration comprises:
- Fixed remuneration (including salary, superannuation, and benefits);
- Short-Term Incentives (STI); and
- Long-Term Incentives (LTI).
STI rewards annual performance based on financial and non-financial measures, while LTI aligns remuneration with long-term performance and typically vests over multiple years.
LTI is primarily targeted at senior employees and supports alignment with Liberty Australia’s strategic objectives and long-term outcomes.
Together, these components ensure remuneration outcomes appropriately balance short-term performance with sustainable, long-term value creation and retention of key talent.
Remuneration Policy and Practices
Alignment with Performance and Risk
Variable remuneration outcomes are determined based on a combination of:
- Individual performance;
- Business performance (including financial outcomes such as underwriting results and premium growth); and
- Risk and conduct outcomes.
Specified Roles and Enhanced Governance
Specified roles include senior management, material risk-takers, and risk and financial control personnel. These roles are subject to enhanced governance, including closer oversight and approval by the SOoA and, where applicable, global governance bodies.
Deferral and Risk Adjustment
A portion of variable remuneration may be deferred and remains subject to ongoing performance, risk and conduct outcomes over time.
Adjustment Mechanisms
Liberty Australia applies robust adjustment mechanisms to ensure remuneration outcomes appropriately reflect risk and conduct, including:
- in-year adjustments;
- malus; and
- clawback provisions.
Variable remuneration may be reduced, adjusted to zero, deferred or clawed back in cases of misconduct, risk management failures or compliance breaches.
Third Party Arrangements
When entering into arrangements with third-party service providers, Liberty Australia assesses remuneration structures to ensure they do not create conflicts with Liberty Australia’s Remuneration Policy.
Legal, HR, Compliance and Risk functions collaborate to review and manage these arrangements to ensure alignment with CPS 511 requirements and Liberty Australia’s risk framework.