Document ID: chunk:federal_register_of_legislation:F2023L00723:front:0:p11
Version: federal_register_of_legislation:F2023L00723
Segment Type: other
Provision Reference: 
Character Range: 33551–37522

of:
                                                                 * Insurance Liability Risk Charge;
                                                                 * Future Exposure Risk Charge; and
                                                                 * DCL Risk Charge

M
Management expenses                  This refers to the relevant forecast of management expenses as defined in HPS 001.
Management expenses (AES) amount     This is the forecast management expenses after the Adverse Event Stress, as defined in HPS 115, for that month.
Management expenses (CE) amount      This is the central estimate forecast of management expenses for that month.

Management expenses (MA) amount      The insurer is required to report this item for months 10, 11 and 12 only. This is to be determined by adjusting management expenses (pre-MA) amount for management Actions as defined in HPS 115.

                                     Management expenses (MA) must only reflect management actions that are appropriate and justified and comply with HPS 115. Management actions should reflect the insurer's expectations and not be limited to the extent that these result in an insurance profit. This constraint will be applied separately in insurance profits forecast after management actions amount.

                                     For months 1 to 9 inclusive, this is a derived item and is equal to management expenses (pre-MA) amount.
Management expenses (pre-MA) amount  This is a derived item, which provides an approximation of management expenses, following the Prescribed Benefit Stress to benefits incurred and management expenses in accordance with HPS 115. This derived item provides a basis from which management actions can be taken in determining management expenses (MA) amount.

                                     For HIB, it is calculated as:

                                       *
                                     where:
                                     A equals Management expenses (AES) amount
                                     B equals HIB stress %

                                     For HRIB, it is calculated as:
                                       *
                                     where:
                                     A equals Management expenses (CE) amount
                                     B equals HRIB stress %

N
Net margin (AES) amount                  This is a derived item. It is calculated as:

                                              * gross margin (AES) amount
                                         less:
                                              * management expenses (AES) amount.
Net margin (CE) amount                   This is a derived item. It is calculated as:

                                              * gross margin (CE) amount
                                         less:
                                              * management expenses (CE) amount,
Net margin (MA) amount                   This is a derived item. It is calculated as:

                                              * gross margin (MA) amount
                                         less:
                                              * management expenses (MA) amount.
Non-reinsurance recoveries - OCL amount  This includes the value of recoveries under arrangements, other than reinsurance and risk equalisation arrangements, receivable by the health benefits fund or general fund associated with the OCL, net of any provisions for depreciation or impairment. It is determined in accordance with HPS 340. This item is to be reported gross of any discounting, as all discounting is to be reported in discount on OCL amount.
Non-reinsurance recoveries - PL amount   This includes the value of recoveries under arrangements, other than reinsurance arrangements, receivable by the health benefits fund or general fund associated with the PL, gross of any provisions for