Document ID: chunk:federal_register_of_legislation:F2023L00697:front:0:p7
Version: federal_register_of_legislation:F2023L00697
Segment Type: other
Provision Reference: 
Character Range: 16662–19721

determined under GPS 340 (GPS 340 PL).

                           Level 2 insurance groups may use approximate methods and may take into account materiality (i.e. whether it would result in a materially different outcome) to report this item if this item is not readily available.

Class of business          Report the items in the sections of this Reporting Standard by the direct or reinsurance classes of business in accordance with GPS 001.

                           For the purpose of calculating the Insurance Risk Charge in respect of the 'other' class of business as per GPS 001 for direct business, the Appointed Actuary is required to determine the most appropriate category (i.e. category A, B or C) in GPS 115 that this business falls within. The choice must be based on the underlying risk characteristics of the business being written. The amounts reported in the other direct - category A, other direct - category B or other direct - category C line items are to follow this basis.

                           For reinsurance business, the classes of business in GPS 115 are to be aggregated by the category and reinsurance type.

Commissions                This item is the present value of commissions expenses associated with the GPS 340 PL.

                           This excludes any acquisition commission expenses that are not reported as part of the GPS 340 PL. This also excludes reinsurance commissions.

                           Level 2 insurance groups may use approximate methods and may take into account materiality (i.e. whether it would result in a materially different outcome) to report this item if this item is not readily available.

D

Direct business  Report direct business written directly by the reporting Level 2 insurance group in accordance with the direct classes of business in GPS 001.

E

Expected future reinsurance costs for current and future reinsurance arrangements needed to cover PL  This is the value of expected future cost of any reinsurance arrangements required to fully cover the exposure period for premiums liabilities. This may include an additional cost for existing reinsurance contracts where the expense is yet to be recognised under Australian Accounting Standards as well as an additional reinsurance purchase cost for any part of the premiums liabilities not covered by current reinsurance arrangements calculated in accordance with GPS 340.

                                                                                                      For avoidance of doubt, the reported figure is to be gross of any recoveries, and should not include any CHE, policy administration expenses (PAE) or risk margin.

G

Gross PL - central estimate (excluding CHE and PAE)  This is the value, as at the relevant date, of the central estimate component of PL, excluding CHE and excluding PAE, gross of any recoveries, determined in accordance with GPS 340. Amounts relating to expected future reinsurance costs for current and future reinsurance arrangements needed to cover PL,