Financial Sector (Collection of Data) (reporting standard) determination No. 9 of 2010 - GRS 301.0 (2010) - Reinsurance Assets and Risk Charge
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Introduction
GRF 301.0 Reinsurance Assets and Risk Charge provides APRA with the necessary information on reinsurance assets[2] and calculates the applicable risk charges on such assets.
Risk Charge
The calculation of the applicable risk charges on an insurer’s (and reinsurer’s) on-balance sheet exposures to reinsurance assets are based on the prescribed method outlined in Prudential Standard GPS 114 Capital Adequacy: Investment Risk Capital Charge (GPS 114). The aggregate of the risk charges calculated in this form is included in the calculation of the insurer’s Minimum Capital Requirement (MCR).
For Category C insurers[3], the risk charge will be applied to reinsurance assets that are deemed inside Australia under section 116A of the Insurance Act 1973 (the Act). For all other insurers, the risk charge will be calculated based on their total reinsurance assets whether they are deemed inside Australia or outside Australia.