Document ID: chunk:federal_register_of_legislation:F2023L00678:body:0:p12
Version: federal_register_of_legislation:F2023L00678
Segment Type: other
Provision Reference: 
Character Range: 32437–35026

Risk Transfer Arrangement entered into by any entities that are not insurers.

   [1]  References to 'reinsurance' throughout this Prudential Standard include 'retrocession'.
[2]  Regulated institutions must satisfy this requirement even where their strategy is to not purchase            a particular type of reinsurance.
[3]  Prudential Standard GPS 110 Capital Adequacy (GPS 110) sets out the required minimum level of capital for regulatory purposes. GPS 110 and Prudential Standard GPS 116 Capital Adequacy: Insurance Concentration Risk Charge (GPS 116) set out specific issues that a regulated institution must consider in calculating its ICRC. A lenders mortgage insurer must also refer to GPS 110 and GPS 116 in determining its ICRC.
[4]  The ReMS must include any individual facultative arrangements.
[5]  Refer to GPS 116 for further details on the PML of an LMI.
   [6]  The Reinsurance Statement does not need to provide a detailed listing of individual facultative arrangements because these, and the processes surrounding their use, will be described in the ReMS.
[7]  Refer to Attachment A for the definition of Limited Risk Transfer Arrangements.
   [8]  By operation of subsection 116A(1) of the Act, for the purposes of determining the amount of assets in Australia under section 28 of the Act, an amount expected to be recovered from a reinsurer is an asset in Australia if it satisfies all the criteria specified in subsection 116A(1), including the criterion that, under the terms of the reinsurance contract, payments by way of reinsurance are to be made in Australia.
   [9]  For the purposes of this Prudential Standard, in the case of a Category C insurer, any reference to 'chief executive officer' may be taken to be a reference to the agent in Australia (by whatever name called), and any reference to 'chief reinsurance officer' may be taken to be a reference to the senior officer (by whatever name called) who holds the equivalent of that position locally.
[10]  For this purpose, full treaty contract (including any appending contract and/or schedules) is defined as a legally binding document on all parties that provides a complete, accurate and definitive record of all the terms and conditions and other provisions of the contract of reinsurance between the contracting parties.
[11]  As defined in Attachment A.
[12]  Refer to the capital standards and reporting standards made under the Financial Sector (Collection of Data) Act 2001.
[13]  Prepared with regard to reporting standards made under the Financial Sector (Collection of Data) Act 2011.