Document ID: chunk:federal_register_of_legislation:F2023L00585:body:0:p6
Version: federal_register_of_legislation:F2023L00585
Segment Type: other
Provision Reference: 
Character Range: 13537–16990

italics are defined in this Definitions section of these instructions.

O

Operational risk charge for business that is not inwards reinsurance (ORCNI)            This is the operational risk charge relating to business written directly by the reporting Level 2 insurance group.

                                                                                        This must be calculated using the ORCNI formula in accordance with GPS 118.
Operational risk charge for inwards reinsurance business (ORCI)                         This is the operational risk charge relating to the reporting Level 2 insurance group's inwards reinsurance business.

                                                                                        This is a derived item and is calculated using the ORCI formula in accordance with GPS 118.
ORCI - central estimate of net insurance liabilities                                    This is the value, relating to the reporting Level 2 insurance group's inwards reinsurance business, of the central estimate component of outstanding claims liabilities (OCL) and premiums liabilities (PL), net of any recoveries that relate to the gross OCL and gross PL, determined in accordance with Prudential Standard GPS 340 Insurance Liability Valuation (GPS 340). The OCL and PL relate to business written directly by the reporting Level 2 insurance group.

                                                                                        Under GPS 340, a Level 2 insurance group may use accounting entries to determine its insurance liabilities. For the purposes of this item, where accounting entries have been used to determine net insurance liabilities, the Level 2 insurance group must use the accounting net insurance liabilities instead of the net central estimate.

ORCI - GWP for the 12 months ending on the date 12 months prior to the reporting date   This is the value of written premium revenue (gross of reinsurance), relating to the reporting Level 2 insurance group's inwards reinsurance business, recognised for the 12 months ending on the date that is 12 months prior to the reporting date.

                                                                                        Written premium revenue is the amount charged in relation to accepting risk from the insured. For the purposes of the Operational Risk Charge calculation, this includes levies imposed by state and territory governments, and revenue relating to portfolio transfers and unclosed business.

ORCI - GWP for the 12 months ending on the reporting date                               This is the value of written premium revenue (gross of reinsurance), relating to the reporting Level 2 insurance group's inwards reinsurance business, recognised for the 12 months ending on the reporting date.

                                                                                        Written premium revenue is the amount charged in relation to accepting risk from the insured. For the purposes of the Operational Risk Charge calculation, this includes levies imposed by state and territory governments, and revenue relating to portfolio transfers and unclosed business.

ORCNI - Central estimate of net insurance liabilities                                   This is the value, relating to the business written directly by the reporting Level 2 insurance group, of the central estimate component of OCL and PL, net of any recoveries