Prescribed Capital Amount

1. The prescribed capital amount is determined as:
   1. the Insurance Risk Charge; plus
   2. the Asset Risk Charge; plus
   3. the Asset Concentration Risk Charge; plus
   4. the Operational Risk Charge; less
   5. an ‘aggregation benefit’ as defined in paragraph 32 to 34; less
   6. tax benefits.
2. The prescribed capital amount is intended to be sufficient, such that if a fund was to start the year with a capital base equal to the prescribed capital amount, and losses occurred at the 99.5 per cent confidence level then the assets remaining would be at least sufficient to provide for the central estimate of insurance liabilities and other liabilities at the end of the year. The other liabilities to be provided for exclude those liabilities that satisfy the criteria for inclusion in the capital base.