• PINS Part A3.1 PINS Part A3.1 Interpretation

    Amended by QFCRA RM/2012-5 (as from 1st July 2013).

    • PINS A3.1.1 PINS A3.1.1 Definitions for app 3

      (1) In this Schedule:

      counterparty grade (or grade) has the meaning given by subrule (2).

      invested asset means an asset, right or interest held by an insurer for the primary purpose of generating revenue or for directly providing funds to meet the insurer's cash outflows in the future.
      (2) For this Schedule, the grade of an asset is its grade according to the rating of its counterparty, in accordance with table A3.1.1.
      Editorial changes (as from 1 January 2015).

      • PINS Table A3.1.1 Grade of assets according to counterparty ratings

        Item Rating of counterparty by: Grade of asset
          Standard & Poor's Moody's A.M. Best Fitch  
        1 AAA Aaa A++ AAA 1
        2 AA+
        AA
        AA-
        Aa1
        Aa2
        Aa3
        A+ AA+
        AA
        AA-
        2
        3 A+
        A
        A-
        A1
        A2
        A3
        A
        A-
        A+
        A
        A-
        3
        4 BBB+
        BBB
        BBB-
        Baa1
        Baa2
        Baa3
        B++
        B+
        BBB+
        BBB
        BBB-
        4
        5 BB+ or below Ba1 or below B or below BB+ or below 5


        (3) Unrated assets, exposures and counterparties must be classified as grade 4.
        Amended by QFCRA RM/2013-1 (as from 1st January 2015).

    • PINS A3.1.2 Using different credit rating agencies

      (1) An insurer must rely on the ratings issued by the same credit rating agency for determining counterparty grades unless the insurer has good reason to use a different credit rating agency or agencies.

      Examples of good reasons

      1 If the rating agency usually used by the insurer does not issue a solicited credit rating for a particular debt obligation and only 1 other rating agency issues a solicited credit rating for the debt obligation
      2 If the rating agency usually used by the insurer does not issue a solicited credit rating for a particular debt obligation, any credit ratings issued by the other rating agencies in table A3.1.1 must be considered and the procedure in rule A3.1.2 (2) used to determine which rating agency will be used.
      (2) If a counterparty or debt obligation has been rated by more than 1 rating agency and there are 2 or more ratings that lead to different capital charges, the insurer must use the credit rating that results in the highest capital charge.
      (3) An insurer must not use the rating of an agency that is not in table A3.1.1 unless the insurer has the written permission of the Regulatory Authority.
      Inserted by QFCRA RM/2013-1 (as from 1st January 2015).