Document ID: chunk:federal_register_of_legislation:F2023L00773:front:0:p5
Version: federal_register_of_legislation:F2023L00773
Segment Type: other
Provision Reference: 
Character Range: 11764–14754

Risk Charge - Future Exposure Risk Charge (HIB)        The Insurance Risk Charge – Future Exposure Risk Charge (HIB) relates to the risk that financial performance of the health insurance business may be materially worse than expected. This must be determined in accordance with HPS 115.

Insurance Risk Charge - Future Exposure Risk Charge (HRIB)       The Insurance Risk Charge – Future Exposure Risk Charge (HRIB) relates to the risk that financial performance of the health-related insurance business may be materially worse than expected. This must be determined in accordance with HPS 115.

Insurance Risk Charge - OCL Risk Charge                          The Insurance Risk Charge – OCL Risk Charge is the Insurance Liability Risk Charge in respect of outstanding claims risk, which relates to the risk that the value of the OCL is greater than the value determined in accordance with HPS 340. This must be determined in accordance with HPS 115.

Insurance Risk Charge - Other Insurance Liabilities Risk Charge  The Insurance Risk Charge – Other Insurance Liabilities Risk Charge is the Insurance Liability Risk Charge in respect of other insurance liabilities, which relates to the risk that the value of other insurance liabilities is greater than the value determined in accordance with HPS 340. This must be determined in accordance with HPS 115.

Insurance Risk Charge - PL Risk Charge                           The Insurance Risk Charge – PL Risk Charge is the Insurance Liability Risk Charge in respect of premiums liabilities risk, which relates to the risk that the value of the OCL is greater than the value determined in accordance with HPS 340. This must be determined in accordance with HPS 115.

Insurance Risk Charge - RE Risk Charge                           The Insurance Risk Charge – RE Risk Charge is the Insurance Liability Risk Charge in respect of risk equalisation, which relates to the risk that the value of the net risk equalisation asset/liability is less favourable than the value determined in accordance with HPS 340. This must be determined in accordance with HPS 115.

O
Operational Risk Charge  The Operational Risk Charge is the minimum amount of capital required to be held against operational risks. The Operational Risk Charge relates to the risk of loss resulting from inadequate or failed internal processes, people and systems or from external events.

                         This must be determined in accordance with Prudential Standard HPS 118 Capital Adequacy: Operational Risk Charge.

P
Prescribed capital amount  The prescribed capital amount for a fund must be determined in accordance with HPS 110.

                           Insurers electing to participate in the transitional arrangements described in HPS 110 should report the adjustment to the prescribed capital amount under this APRA-approved adjustment type.

Specific Instructions

Table 1: Adjustments and exclusions

Reporting basis

This table applies to