PINS A3.7 Guidance

An insurer may be exposed to the risk that the cost of future claims in respect of general insurance business will exceed the cost implicit in the premiums being charged. The purpose of the premium risk component is to require an insurer to hold capital against this risk in accordance with the calculations set out in rule A3.7.1. The basic calculation model in rule A3.7.1 applies different factors to the premium in respect of each PINS category, based on the different perceived risk of variability associated with each.

Amended by QFCRA RM/2013-1 (as from 1st January 2015).