Outstanding Claims Risk ChargeOutstanding Claims Risk Charge

Outstanding Claims Risk Charge

1. The Outstanding Claims Risk Charge relates to the risk that the value of the outstanding claims liabilities will be greater than the value determined in accordance with Prudential Standard HPS 340 Insurance Liability Valuation (HPS 340).
2. The risk charge is calculated by multiplying the outstanding claims liabilities[1] excluding claims settled but not yet paid by the Outstanding claims risk size margin defined in paragraph 13.
3. The outstanding claims of both HIB and HRIB are subject to the risk margin defined in paragraph 13.
4. The Outstanding claims risk size margin of a fund is calculated as:

The minimum of 1.03 times bracket hospital treatment single equivalent units close bracket to the power of negative 0.16 comma 0.34