Document ID: chunk:federal_register_of_legislation:F2017L00435:body:0:p8
Version: federal_register_of_legislation:F2017L00435
Segment Type: other
Provision Reference: 
Character Range: 19433–22552

each quarter;

        (b)               the funding requirement is:

            (i)            on 1 July 2000—the amount worked out in accordance with paragraph 8 of this Attachment for the last quarter that ended more than 30 days before 1 July 2000; and

            (ii)          for a quarter ending after 1 July 2000—the amount worked out in accordance with paragraph 8 of this Attachment for that quarter.

8.             The funding requirement for a quarter is, in respect of each syndicate year of account with liabilities secured by the fund (other than a closed year of account of a syndicate):

        (liabilities  scaling factor1%) + (premium income  scaling factor2%)

where:

liabilities means the reported gross of reinsurance outstanding claims liabilities for the year of account of the syndicate on the last day of the rebalancing period.

premium income means premium income, net of brokerage but gross of reinsurance ceded, for the syndicate for the open year of account of the syndicate for which the liabilities are secured by the fund.

scaling factor1 and scaling factor2 are amounts determined by APRA so that the result of the formula is a reasonable estimate of the value of aggregated secured liabilities on the last day of the rebalancing period:

        (a)                net of reinsurance;

        (b)               discounted to allow for the time value of money; and

        (c)                including liabilities incurred but not reported.

9.             For paragraph 8 of this Attachment, a syndicate year of account is closed if all the liabilities of the syndicate for that year of account have been reinsured under reinsurance to close.

Reserve fund
10.         For the reserve fund:

        (a)                the rebalancing period is each year; and

        (b)               the funding requirement is:

            (i)            on 1 July 2000 – $3 million; and

            (ii)          for a year ending after 1 July 2000 – the greater of:

               (A)        6% of the aggregate funding requirement of the new business fund; or

               (B)        $3 million.

Attachment C – Accounts and statements

Part 1 - Commentary
     1. The accounts and statements required for paragraph 22 are:

       (a)          Form L1—Underwriting Account for Insurance Business in Australia (to be lodged annually within four months of the balance date);

       (b)          Form L2—Underwriting Analysis by Class of Insurance Business (to be lodged annually within four months of the balance date);

       (c)          Form L3Q—Quarterly Statement of Reported Claims Outstanding for 1992 and Prior Business—"Equitas Fund" (to be lodged for each quarter defined in paragraph 1 of Attachment B and within 45 days of the quarter end);

       (d)          Form L4Q—Quarterly Statement of Premiums and Claims for 1/1/93 to 30/6/98 Business—"Interim Fund" (to be lodged for each quarter defined in paragraph 1 of Attachment B and within 45 days of the quarter end); and

       (e)          Form L5Q—Quarterly Statement of Premiums