LLM3090 - Reinsurance to close (RITC) and technical provisions: section 107 FA2000: adaptations for Lloyd's members (page 2 of 3): regulation 7(4) and (5) of the GI reserves tax Regulations
Regulation 7(4)
Regulation 7(4) amends the terminology of Rule 2 of regulation 3 for Lloyd바카라 사이트™s members. Rule 2 is the rule that determines how to find the 바카라 사이트™original provisions바카라 사이트™ for the earlier period. As with regulation 7(3), the term 바카라 사이트˜technical provisions바카라 사이트™ is substituted for 바카라 사이트˜claims outstanding바카라 사이트™, so that the original provisions are the Lloyd바카라 사이트™s technical provisions - the RITC or EFL for the earlier period.
Rule 2.1(b) of regulation 3 is amended so that, as for other general insurers, for APs other than the 2000 AP, the provisions to be looked at were those that related directly to new business of that year or previous year바카라 사이트™s RITC that is new to that member.
LLM3050 gives examples of the application of this principle.
Regulation 7(5)
Regulation 7(5)(a) amends the terminology of Rule 3 of regulation 3 for Lloyd바카라 사이트™s members. Rule 3 is the rule that determined how to find the 바카라 사이트™cost of settling liabilities to which the original provisions relate바카라 사이트™. Claims paid including the cost of settling liabilities are the RITC paid by the member of the reinsurer syndicate. This is explained at LLM3070 and the examples referred to therein.
Regulation 7(5)(b) introduces the 바카라 사이트™one year later바카라 사이트™ rule to ensure that the calculations fit with the declarations basis. The RITC premium and claims and expenses in relation to the liabilities are deemed to arise one year later than they are actually paid (that is, in the declaration year), see examples at LLM3050.
Regulation 7(5)(c) applies in the case of run-off syndicates. In Rule 3 of regulation 3, 바카라 사이트˜claims outstanding바카라 사이트™ refers to the EFL of an open syndicate.