| (Cap 41, section 59) [27 October 1995] L.N. 484 of 1995 (L.N. 327 of 1995) Cap 41E s 1 (Omitted as spent) (Omitted as spent) (Enacted 1995) Cap 41E s 2 Interpretation In this Regulation, unless the context otherwise requires- "asset" (资产) includes part of an asset; "deposit back arrangement" (回存安排), in relation to any contract of reinsurance, means an arrangement whereby an amount is deposited by the reinsurer with the cedant; "equity share" (权益股) means a share of equity share capital; "equity share capital" (权益股本) means, in relation to a company, its issued share capital excluding any part thereof which, neither as respects dividends nor as respects capital, carries any right to participate beyond a specified amount in a distribution; "fixed interest securities" (定息证券) means securities which under their terms of issue provide for fixed amounts of interest; "index linked benefits" (与指数相连的利益) means benefits- (a) provided for under any contract the effecting of which constitutes the carrying on of long term business; and (b) determined by reference to fluctuations in any index of the value of property (whether specified in the contract or not);"linked assets" (相连资产) means long term business assets of an insurer which are, for the time being, identified in the records of the insurer as being assets by reference to the value of which property linked benefits are to be determined; "long term business assets" (长期业务资产) means assets of an insurer which are, for the time being, identified as representing the long term fund or funds maintained by the insurer in respect of its long term business; "long term liabilities" (长期负债) means liabilities of an insurer arising under or in connection with contracts for long term business, including liabilities arising from deposit back arrangements; "property linked benefits" (与财产相连的利益) means benefits (other than index linked benefits)- (a) provided for under any contract the effecting of which constitutes the carrying on of long term business; and (b) determined by reference to the value of, or the income from, property of any description (whether specified in the contract or not);"securities" (证券) includes shares, debentures, treasury bills, tax reserve certificates and certificates of tax deposit; "share" (股份) includes stock; "valuation date" (估值日期), in relation to an actuarial investigation, means the date to which the investigation relates. (Enacted 1995) Cap 41E s 3 Application This Regulation shall apply with respect to the determination of the amount of liabilities of an insurer in respect of its long term business. (Enacted 1995) Cap 41E s 4 Determination of long term liabilities (1) Subject to this Regulation, the amount of liabilities of an insurer in respect of long term business shall be determined in accordance with generally accepted accounting concepts, bases and policies or other generally accepted methods appropriate for insurers. (2) The determination of the amount of long term liabilities (other than liabilities which have fallen due for payment before the valuation date) shall- (a) be made on actuarial principles which have due regard to the reasonable expectations of policy holders; (b) make proper provision for all liabilities on prudent assumptions that shall include appropriate margins for adverse deviation of the relevant factors; and (c) take account of all prospective liabilities as determined by the policy conditions for each existing contract, taking credit for premiums payable after the valuation date.(3) Without prejudice to the generality of subsections (1) and (2), the amount of the long term liabilities shall be determined in compliance with each of sections 5 to 16 and shall take into account, inter alia, the following factors- (a) all guaranteed benefits, including guaranteed surrender values; (b) vested, declared or allotted bonuses to which policy holders are already either collectively or individually contractually entitled; (c) all options available to the policy holder under the terms of the contract; and (d) expenses, including commissions. (Enacted 1995) Cap 41E s 5 Method of calculation (1) Subject to subsections (2), (3) and (4), the amount of the long term liabilities shall be determined separately for each contract by a prospective calculation. (2) A retrospective calculation may be applied to determine the liabilities where a prospective method cannot be applied to a particular type of contract or benefit, or where it can be demonstrated that the resulting amount of the liabilities would be no lower than would be required by a prudent prospective calculation. (3) Appropriate approximations or generalisations may be made where they are likely to provide the same, or a higher, result than individual calculations of the same amount of the liabilities in respect of each contract. (4) Where necessary, additional amount shall be set aside on an aggregated basis for general risks which are not individualised. |
