Financial Sector (Collection of Data) determination No. 14 of 2005
Specific instructionsSpecific instructions
Start here
Get a plain-English read of Specific instructions
Turn the raw legal text into a practical explanation grounded in Financial Sector (Collection of Data) determination No. 14 of 2005.
Specific instructions
While the forms needs to be lodged on a quarterly basis to enable the calculation of a capital charge, as this analysis is normally completed formally on an annual basis, there is no need to remodel the charge each quarter.
Refer to GGN 110.5 Concentration Risk Capital Charge for further information on the method of calculation and definitions.
Maximum Event Retention
Refers to the MER and is the largest loss to which an insurer will be exposed (taking into account the probability of that loss) due to a concentration of policies, after netting out any reinsurance recoveries.
The company should assume that all valid claims under these reinsurance arrangements would be paid to the company by the reinsurer.
Include all relevant classes, giving rise to claims on the company from any one single event (including co-insurance).
Cost of one reinstatement
Input the cost of one reinstatement premium for the insurer’s catastrophe reinsurance.
Total Maximum Event Retention charge
This is automatically calculated by the form. It represents the addition of the value input for the MER and the value entered for the cost of one reinstatement premium. This amount is included in the calculation of the MCR for the insurer.