Expected Reinsurance RecoveriesExpected Reinsurance Recoveries

Expected Reinsurance Recoveries

“Expected reinsurance recoveries” is a term used to describe the value of future liabilities that are recognised as “Premium Liabilities” (in accordance with GPS 210 Liability Valuation of General Insurers), that are expected to be recovered under reinsurance contracts. Expected reinsurance recoveries is to be determined in accordance with the principles of GPS 210 Liability Valuation of General Insurers. The principles of this standard should be applied with similar robustness to the valuation of gross (of reinsurance) premium liabilities.

Where advice of an Approved Actuary is required in regard to the valuation of the premium liabilities, the Approved Actuary should also consider the estimation of the expected reinsurance recoveries on the premium liabilities recognised. Actuarial judgement should be used in the application of the principles of GPS 210 Liability Valuation of General Insurers in those circumstances.

Expected reinsurance recoveries does not include other forms of reinsurance assets or other form of non-reinsurance recoveries. Non reinsurance recoveries are amounts that may be recovered under arrangements other than reinsurance arrangements. These would include salvage, subrogation and sharing agreements.