Document ID: chunk:federal_register_of_legislation:F2023L00570:front:0:p14
Version: federal_register_of_legislation:F2023L00570
Segment Type: other
Provision Reference: 
Character Range: 40775–44252

This amount must be consistent with premiums receivable reported in GRS 112.0.G.
Property stress                            This is the impact on a Level 2 insurance group's capital base of changes in property and infrastructure asset values and must be calculated in accordance with GPS 114.

(Stress scenario type)
Property (direct)                          This is the value of property held by the reporting Level 2 insurance group, in accordance with the classification and measurement basis under the relevant Australian Accounting Standards.

(Items subject to Asset Risk Charge type)

R
Real interest rates downwards stress                   The real interest rates stress measures the impact on a Level 2 insurance group's capital base of downward changes in real interest rates. It also affects nominal interest rates.

(Stress scenario type)                                 This item is calculated in accordance with GPS 114.
Real interest rates upwards stress                     The real interest rates stress measures the impact on a Level 2 insurance group's capital base of upward changes in real interest rates. It also affects nominal interest rates.

(Stress scenario type)                                 This item is calculated in accordance with GPS 114.
Reinsurance recoverables on outstanding claims         This is the value of the central estimate of reinsurance recoverables in relation to reinsurance contracts for outstanding claims. This item does not include amounts under reinsurance contracts that do not meet the reinsurance documentation test or governing law requirements under Prudential Standard GPS 230 Reinsurance Management (GPS 230).

(Items subject to Asset Risk Charge type)
Rental yield used in determination of property stress  This is the average rental yield for the property assets, based on current leases, and net of expenses.

(Yields used in stress scenarios type)
Risk charge components                                 This item is calculated for each stress scenario type as the greater of zero and the impact on capital base amount.

                                                       If the impact on capital base is less than zero then the risk charge component is equal to the absolute value of the impact on capital base.

                                                       If the impact on capital base is greater than zero then the risk charge component is zero.

S
Stress scenario amount  This is the contribution of the relevant items towards the change in capital base under the stress scenario types.

                        Specifications of the stresses are determined in accordance with GPS 114.

Stress scenario type    This consists of the stress scenarios that must be applied to individual items under GPS 114. The scenarios are:

                            * real interest rates upwards stress;
                            * real interest rates downwards stress;
                            * expected inflation upwards stress;
                            * expected inflation downwards stress;
                            * currency upwards stress;
                            * currency downwards stress;
                            * equity stress;
                            * property stress;
                            * credit spreads stress; and
                            * default stress.

Y
Yields used in stress scenario percent  This is the percentage values of