PINS 8.6.7 PINS 8.6.7 Treatment of premium liability
An insurer must recognise as a liability the premium liability, which is the value of future claims payments and associated direct and indirect settlement costs, arising from future events insured under policies that are in force as at the solvency reference date.
Amended by QFCRA RM/2017-3 (as from 1st April 2017).
PINS 8.6.7 Guidance
The liability referred to in PINS Rule 8.6.7 is commonly represented by insurers as 2 separate provisions, the unearned premium provision and the premium deficiency provision. The sum of the 2 provisions is sometimes referred to as the unexpired risk reserve, though this term is also sometimes used to describe the premium deficiency provision alone.
Editorial changes (as from 1 January 2015).