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CA-2.1.14

The claim basis calculationG for general insurance businessG is determined by applying the following formula:

Average Gross Claims Incurred in the reference period X Reinsurance Allowance X Risk Factor (for each class of business)

Where:

Average Gross Claims Incurred =

Gross Claims Incurred in the reference periodG (see CA-2.1.15) divided by the number of years covered by the reference periodG (or annualised where any financial year in the reference period is other than 12 months)

Reinsurance Allowance (Claim basis) = (calculated on total business)

the higher of 0.5 or (Total Average Net Claims Incurred in the reference periodG /Total Average Gross Claims Incurred in the reference periodG )

Risk Factor =

(a) Fire 20%
(b) Damage to property 20%
(c) Miscellaneous financial loss 20%
(d) Marine cargo, marine hull 25%
(e) Aviation 25%
(f) Motor 25%
(g) Engineering 25%
(h) Liability 25%
(i) Medical (short term ≤ 1 year) 25%
(j) Other 25%
Amended: January 2007
 Versions
(2 Versions)
 
Up to Jun 30 2007Jul 1 2007 onwards
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