1.1. Greater of Capital Adequacy Liabili1.1. Greater of Capital Adequacy Liability and Current Termination Value (CTV)

1.1. Greater of Capital Adequacy Liability and Current Termination Value (CTV)

Each of Items 1.1.1 to 1.1.3 inclusive are to be reported under three columns, relating to the amounts for each item –

• Gross of outwards reinsurance (Column 1);
• Reinsurance ceded under outwards reinsurance (Column 2); and
• Net of outwards reinsurance (Column 3).

In paragraphs 7.2 and 7.3 of LPS 3.04, the actuary is relieved of calculating the total Capital Adequacy Liability (CAL) and the total CTV (respectively) for a related product group (RPG) under certain conditions. For aggregating and reporting purposes, the single amount calculated for an RPG should be included in both the CAL and the CTV, rather than not including any value for the inapplicable item.

Amounts under Columns 1 and 2 for Item 1.1.3 are reported amounts, not derived amounts, as effectively the maximum in each case is taken at the RPG level and then aggregated across the statutory fund. Therefore each of these amounts will not necessarily match the greater of the corresponding amounts entered under Items 1.1.1 and 1.1.2.

Note that amounts under Column 2 are expected to be entered with the opposite arithmetical sign to amounts under Column 1. Therefore Column 3 is derived for each item as the sum of Columns 1 and 2.