Key terms referred to in the Relevant Prudential Standards are defined as follows:

[ADI, GI, LI, PHI] AASB means the Australian Accounting Standards Board.

[ADI] account-holder has the meaning in section 5 of the Banking Act.

[GI] accounts of a Level 2 insurance group, for the purposes of the prudential requirements applicable to Level 2 insurance groups, refers to accounts constituting reporting documents required to be prepared by the parent entity of the group in compliance with reporting standards made under the FSCODA and includes both annual accounts and half-yearly accounts in respect of a group's financial year.

[PHI] accrued premium for the relevant class of business, is calculated as follows:

where:

A equals premiums in advance at the end of the specified period minus premiums in advance at the start of the specified period;

B equals unpaid premiums at the end of the specified period minus unpaid premiums at the start of the specified period; and

premiums must be inclusive of relevant levies, loadings and discounts.

This item should be calculated net of any reinsurance arrangements.

[GI] acquisition expenses  means the fixed and variable expenses of a regulated institution to the extent they are, either directly or indirectly, referable to those activities of the company related to the acquiring of that new or renewal business expected to derive from the expenditure.

[LI] acquisition expenses means the fixed and variable expenses of a life company to the extent they are, either directly or indirectly, referable to those activities of the company related to the acquiring of that new business expected to derive from the expenditure.

[GI, LI] Actuarial Valuation Report (AVR) is as defined in Prudential Standard CPS 320 Actuarial and Related Matters.

[ADI] Additional Tier 1 Capital is as defined in Prudential Standard APS 111 Capital Adequacy: Measurement of Capital.

[GI] Additional Tier 1 Capital is as defined in Prudential Standard GPS 112 Capital Adequacy: Measurement of Capital.

[LI] Additional Tier 1 Capital is as defined in Prudential Standard LPS 112 Capital Adequacy: Measurement of Capital.

[PHI] Additional Tier 1 Capital is as defined in Prudential Standard HPS 112 Capital Adequacy: Measurement of Capital.

[LI] adequacy threshold is the minimum value for expected future profits of a subcategory under Prudential Standard LPS 340 Valuation of Policy Liabilities - i.e. it is the level at which losses must be recognised. Subcategory is defined in the Life Insurance Act.

[LI] adjusted policy liabilities means the liabilities to policy owners as defined for the purpose of determining the capital base of a statutory fund and general fund in Prudential Standard LPS 112 Capital Adequacy: Measurement of Capital.

[GI] agent in Australia has the same meaning as in the Insurance Act.

[ADI] AIRB refers to an advanced internal-ratings based approach to credit risk, as defined in Prudential Standard APS 113 Capital Adequacy: Internal Ratings-based Approach to Credit Risk.

[GI] Appointed Actuary means an actuary appointed under section 39(1)(b) of the Insurance Act.

[LI] Appointed Actuary means an actuary appointed under section 93 of the Life Insurance Act.

[PHI] Appointed Actuary has the same meaning as in the PHIPS Act.

[ADI] appointed auditor means an auditor appointed for the purposes of Prudential Standard APS 310 Audit and Related Matters.

[GI] appointed auditor means an auditor appointed under paragraph 39(1)(a) of the Insurance Act.

[PHI] appointed auditor means an auditor appointed for the purposes of Prudential Standard HPS 310 Audit and Related Matters.

[LI] approved benefit funds refers to friendly society benefit funds approved by APRA according to the provisions of Prudential Standard LPS 700 Friendly Society Benefit Funds and the Life Insurance Act.

[LI] APRA product groups means the product groups listed and defined in Reporting Standard LRS 001 Reporting Requirements. The product groups are to be used for the purpose of completing the information required under Reporting Standard LRS 200.0 Capital Adequacy Supplementary Information.

[GI] APRA-authorised reinsurer means an insurer carrying on reinsurance business. For the purposes of this definition, a Lloyd’s underwriter as defined under the Insurance Act is an APRA-authorised reinsurer if it carries on reinsurance business. The Australian Reinsurance Pool Corporation is also considered an APRA-authorised reinsurer for the purposes of this definition.

[PHI] APRA-authorised reinsurer means an insurer carrying on reinsurance business for a private health insurer.

[GI] Asset Concentration Risk Charge means the risk charge determined under Prudential Standard GPS 117 Capital Adequacy: Asset Concentration Risk Charge.

[LI] Asset Concentration Risk Charge means the risk charge determined under Prudential Standard LPS 117 Capital Adequacy: Asset Concentration Risk Charge.

[PHI] Asset Concentration Risk Charge means the risk charge determined under Prudential Standard HPS 117 Capital Adequacy: Asset Concentration Risk Charge.

[GI] Asset Risk Charge means the risk charge determined under Prudential Standard GPS 114 Capital Adequacy: Asset Risk Charge.

[LI] Asset Risk Charge means the risk charge determined under Prudential Standard LPS 114 Capital Adequacy: Asset Risk Charge.

[PHI] Asset Risk Charge means the risk charge determined under Prudential Standard HPS 114 Capital Adequacy: Asset Risk Charge.

[GI, LI, PHI] associate means an associate as defined under Australian Accounting Standard AASB 128 Investments in Associates and Joint Ventures.

[ADI, GI, LI, PHI] AUASB refers to the Auditing and Assurance Standards Board.

[ADI, GI, LI, PHI] Australian Accounting Standards is a reference to the Australian Accounting Standards issued by the AASB.

[ADI, GI, LI, PHI] Australian Auditing and Assurance Standards or Auditing and Assurance Standards is a reference to the Australian Auditing and Assurance Standards issued by the AUASB.

[GI] Australian business of a Level 2 insurance group, for the purposes of the prudential requirements applicable to Level 2 insurance groups, means insurance business carried on (whether in Australia or elsewhere) by any Level 1 insurer within the group.

[ADI] Australian-owned ADI refers to an ADI that is not a foreign-owned ADI.

[ADI, GI, LI, PHI] authorised deposit-taking institution (ADI) means a deposit-taking institution authorised by APRA under the Banking Act. It includes foreign ADIs as defined in the Banking Act.

[ADI] authorised NOHC has the same meaning as in the Banking Act.

[GI] authorised NOHC has the same meaning as in the Insurance Act.

[ADI] Banking Act refers to the Banking Act 1959.

[PHI] benefits incurred are the value of all insurance claims incurred during the period for the relevant class of business, net of risk equalisation expense, net of reinsurance and include ambulance levies. This is to include the value of services provided in lieu of a benefit payment and movements in the central estimate of outstanding claims liabilities.

[LI] best estimate assumptions means assumptions about future experience determined in accordance with Prudential Standard LPS 340 Valuation of Policy Liabilities.

[LI] best estimate bonus refers to the maximum level of bonus which (on best estimate assumptions and taking into account a life company’s profit distribution philosophy, including shareholder entitlements) can be added to a participating benefit over its benefit life without supplementary income from other sources, including policy owner retained profits.

[LI] best estimate discretionary addition means the level of discretionary addition which (on best estimate assumptions and taking into account a life company’s crediting philosophy) can be added to a non-participating benefit over its benefit life without supplementary income from other sources, including policy owner retained profits.

[LI] best estimate liability is calculated in accordance with Prudential Standard LPS 340 Valuation of Policy Liabilities and refers to the amount expected on best estimate assumptions to be required to the end of the benefit period to meet future benefits and expenses related to past transactions for the business in force. The calculation process will take into account all factors which are known to be material, including future investment earnings, taxation, any options under the policies and future premiums, where relevant to the calculation.

[LI] best estimate shareholder profit refers to the maximum level of shareholder profit which (on best estimate assumptions and taking into account a life company’s profit distribution philosophy, including policy owner entitlements) can be attributed to shareholders without supplementary income from other sources, including shareholders’ retained profits.

[ADI] board means the board of directors of an institution or, where relevant, the senior officer outside Australia.

[GI] board means the board of directors or, where relevant, the senior officer outside Australia.

[LI] board means the board of directors and includes, for an Eligible Foreign Life Insurance Company, the Compliance Committee as required under subsection 16ZF(4) of the Life Insurance Act.

[PHI] board means the board of directors of an institution.

[PHI] Board Audit Committee has the same meaning as in Prudential Standard CPS 510 Governance.

[PHI] Board Remuneration Committee has the same meaning as in Prudential Standard CPS 510 Governance.

[PHI] Board Risk Committee has the same meaning as in Prudential Standard CPS 510 Governance.

[LI] bonus means an amount of profit added at the discretion of a life company (including additions in respect of investment experience) to the benefits due under a participating benefit but excluding any guaranteed rate of addition also applicable to the benefit.

[ADI, GI, PHI] business day means a day that is not a Saturday, a Sunday or a public holiday or bank holiday in the place concerned.

[GI, LI, PHI] business plan refers to a written business plan as part of a general insurer, Level 2 insurance group, life company or private health insurer’s risk management framework as required under Prudential Standard CPS 220 Risk Management.

[LI] capital adequacy standards collectively refers to all prudential standards relating to the capital adequacy of life companies and falls within the meaning of prudential standards in relation to capital adequacy referred to under the Life Insurance Act.

[GI] capital base is as defined in Prudential Standard GPS 112 Capital Adequacy: Measurement of Capital.

[LI] capital base is as defined in Prudential Standard LPS 112 Capital Adequacy: Measurement of Capital.

[PHI] capital base is as defined in Prudential Standard HPS 112 Capital Adequacy: Measurement of Capital.

[GI] capital standards refers collectively to all GI Prudential Standards relating to capital adequacy.

[PHI] capital standards refers collectively to all PHI Prudential Standards relating to capital adequacy.

[PHI] cash has the meaning given in Australian Accounting Standards Standard 107.6.

[GI] Category A insurer means an insurer incorporated in Australia. This category excludes all insurers falling within any of the other categories. For the purposes of clarification, wholly-owned subsidiaries of corporate groups that are not insurance groups fall into this category where they do not already fall into another category of insurer under this Prudential Standard. Category A insurers could be mutual companies or shareholder companies.

[GI] Category B insurer means an insurer that is:

Category B insurers are part of a local or foreign insurance group. They could be subsidiaries of mutual or shareholder companies. An insurance group captive is not a Category B insurer.

[GI] Category C insurer means a ‘foreign general insurer’ defined under subsection 3(1) of the Insurance Act. A Category C insurer is a foreign insurer operating as a foreign branch in Australia and could be a branch of a foreign mutual or shareholder company.

[GI] Category D insurer means an insurer incorporated in Australia that:

Category D insurers are often referred to as ‘association captives’ and could be mutual companies or shareholder companies.

[GI] Category E insurer means an insurer incorporated in Australia that is a:

Category E insurers, often referred to as ‘sole parent captives’, will generally be shareholder companies.

[ADI] CCR refers to counterparty credit risk.

[PHI] central estimate means an estimate of the mean of the range of possible outcomes of any calculation required under Prudential Standard HPS 110 Capital Adequacy.

[ADI] Cheques Act refers to the Cheques Act 1986.

[PHI] Chief executive officer has the same meaning as in the PHIPS Act.

[PHI] claims component is the central estimate of claims that a private health insurer expects to incur. For the outstanding claims liabilities, this includes:

For each outstanding claims liabilities and premiums liabilities, the claims component is to be calculated gross of reinsurance and non-reinsurance recoverables.

[GI, PHI] claims handling expenses are the costs that a regulated institution expects to incur in the management and settling of claims, which includes an appropriate allocation of business overheads such as claims department and corporate office overheads. For the outstanding claims liability, this includes the cost of future claims management, claims administration expenses for all incurred claims and the establishment expenses of not yet reported claims. For premiums liabilities, this includes claims management and claims administration expenses for claims establishment and run-off.

[PHI] claims incurred are the value of all insurance claims incurred during the period for the relevant class of business, gross of risk equalisation, net of reinsurance. This is to include the value of services provided in lieu of a benefit payment and movements in the central estimate of outstanding claims liabilities.

[GI] classes of business, including direct classes of business and reinsurance classes of business, are defined in Attachment B to this Prudential Standard.

[LI] commencement means the time from which a life company is at risk under a policy.

[ADI] Common Equity Tier 1 Capital is as defined in Prudential Standard APS 111 Capital Adequacy: Measurement of Capital.

[GI] Common Equity Tier 1 Capital is as defined in Prudential Standard GPS 112 Capital Adequacy: Measurement of Capital.

[LI] Common Equity Tier 1 Capital is as defined in Prudential Standard LPS 112 Capital Adequacy: Measurement of Capital.

[PHI] Common Equity Tier 1 Capital is as defined in Prudential Standard HPS 112 Capital Adequacy: Measurement of Capital.

[PHI] company means:

[PHI] complying health insurance product has the same meaning as in the PHIPS Act.

[ADI] conglomerate group is as defined in Attachment A to this Prudential Standard.

[PHI] constitutional corporation has the same meaning as in the PHIPS Act.

[GI] controlled entity of a non-operating holding company or insurer, for the purposes of the prudential requirements applicable to Level 2 insurance groups, means a subsidiary as defined in Australian Accounting Standards for the purposes of determining the entities included in consolidated general purpose financial statements.

[GI] corporate agent has the same meaning as in the Insurance Act.

[GI] corporate captive means an insurer that:

Corporate captives include insurance group captives.

[ADI] corporate finance activities includes underwriting and any holdings of equity or debt arising from underwriting, arranging, facilitation, and management activities such as those associated with securitisation, mergers and acquisitions or privatisations and syndication activities that are undertaken, predominantly, with the intention of earning a fee. Corporate finance activities also includes longer term positions in equities that are held for strategic reasons and holdings in equity instruments, or in instruments that exhibit characteristics that are more like equity than debt, that arise as a consequence of loan restructurings.

[PHI] corporate governance means a system by which an APRA-regulated institution is directed and controlled.

[GI, LI, PHI] corporate group is a group of entities comprising two or more companies that are related bodies corporate within the meaning of section 50 of the Corporations Act.

[ADI, GI, LI, PHI] Corporations Act refers to the Corporations Act 2001.

[GI, LI, PHI] counterparty grade refers to the classification applied to an investment or exposure as per the requirements of Attachment C to this Prudential Standard.

[ADI] credit rating grades means grades of credit ratings to which ECAI ratings are mapped, and that correspond to relevant asset risk weights.

[LI] current termination value refers to the termination value of a policy at the reporting date.

[GI, PHI] debt obligations for the purposes of the Asset Risk Charge and Asset Concentration Risk Charge refers to all loans, deposits, placements, interest rate securities and other receivables.

[LI] defined benefit fund is as defined in Prudential Standard LPS 700 Friendly Society Benefit Funds.

[LI] defined contribution fund is as defined in Prudential Standard LPS 700 Friendly Society Benefit Funds.

[GI] direct classes of business are as defined in Attachment B to this Prudential Standard.

[GI] director has the same meaning as in the Insurance Act.

[LI] discretionary addition means an amount added to a non-participating benefit, at the discretion of a life company, to reflect the investment experience of the assets backing the benefit, but excluding any guaranteed rate of addition also applicable to the benefit. For this definition an amount added to a benefit is defined to mean any change to the previously applying contractual conditions that is beneficial to the policy owner.

[LI] discretionary participation feature means a contractual right to receive, as a supplement to guaranteed benefits, additional benefits:

A policy with a discretionary participation feature can provide benefits that are either participating benefits or non-participating benefits.

[LI] education bond business means a form of unbundled investment business where the policies provide for the payment of a benefit for the specific purpose of contributing towards the expenses of, and incidental to, the education of the beneficiary.

[LI] Eligible Foreign Life Insurance Company (EFLIC) has the meaning given in section 16ZD of the Life Insurance Act.

[ADI, GI, LI, PHI] ensure, when used in relation to a responsibility of the board, means to take all reasonable steps and make all reasonable enquiries as are appropriate for a board so that the board can determine, to the best of its knowledge, that the stated matter has been properly addressed.

[LI] establishment fee is a fee received at the commencement of a policy which is intended to, at least partially, cover acquisition expenses. It does not include contingent entitlement to exit fees or surrender penalties.

[GI] expected reinsurance recoveries means any amounts due to an insurer, or to an entity that carries on international business within a Level 2 insurance group, from a reinsurer that arise from the recognition of premiums liabilities referred to in the GI Prudential Standards (including Prudential Standard GPS 340 Insurance Liability Valuation). This is distinguished from reinsurance recoverables.

[PHI] expected reinsurance recoveries means any amounts due to a private health insurer from a reinsurer that arise from the recognition of premiums liabilities referred to in the PHI Prudential Standards (including Prudential Standard HPS 340 Insurance Liability Valuation). This is distinguished from reinsurance recoverables.

[LI] expense category refers to a grouping of expenses directly or indirectly referable to life business. For the purposes of prudential standards, three categories of expense are defined: acquisition expenses, maintenance expenses and investment management expenses.

[LI] expense driver means a quantifiable measure in relation to which the relevant expenses of a life company are expected to vary.

[LI] experience profit means the profit arising in a period from the difference between actual experience during that period and expected experience on the basis of best estimate assumptions at the beginning of the period.

[ADI] extended licensed entity (ELE) is comprised of an ADI and each subsidiary of that ADI as specified in any approval granted by APRA in accordance with Prudential Standard APS 222 Associations with Related Entities.

[ADI] external credit assessment institution (ECAI) means an entity that assigns credit ratings designed to measure the creditworthiness of a counterparty or certain types of debt obligations of a counterparty.

[GI, LI, PHI] fair value has the same meaning as it does in the Australian Accounting Standards and refers to the amount for which an asset could be exchanged, or a liability settled, between knowledgeable, willing parties in an arm’s length transaction.

[GI, LI, PHI] Financial Condition Report (FCR) is as defined in Prudential Standard CPS 320 Actuarial and Related Matters.

[ADI] financial institution includes any institution engaged substantively in one or more of the following activities – banking; leasing; issuing credit cards; portfolio management (including asset management and funds management); management of securitisation schemes; equity and/or debt securities, futures and commodity trading and broking; custodial and safekeeping services; insurance (both general and life) and similar activities that are ancillary to the conduct of these activities. A financial institution includes any authorised NOHC or overseas equivalent.

[LI] financial instrument element means the activities and associated cash flows of a life investment contract that relate directly to the establishment of a financial asset or financial liability.

[PHI] financial interdependency, in relation to a group of related counterparties, means a circumstance in which the financial soundness of one counterparty in the group may affect the financial soundness of another counterparty in the group.

[LI] financial risk refers to the risk of a possible future change in one or more specified economic variables – a specified interest rate, financial instrument price, commodity price, foreign exchange rate, index of prices or rates, a credit rating or credit index or other variable, provided in the case of a non-financial variable that the variable is not specific to a party to the contract.

[GI] financial year, in relation to a Level 2 insurance group, means the financial year (within the meaning of the Corporations Act) of the parent entity of the Level 2 insurance group.

[ADI] FIRB refers to Foundation IRB, as defined in Prudential Standard APS 113 Capital Adequacy: Internal Ratings-based Approach to Credit Risk.

[LI] fixed term/rate business means policies which provide for guaranteed investment returns at a disclosed rate for a specified period. The guaranteed returns may be paid in the form of income or as capital at maturity. The specified period of the guarantee may be the full term of the policy, or may be to an interim point at which the option exists to ‘roll’ the policy for a further specified period at a new guaranteed return.

[ADI] foreign ADI has the meaning in section 5 of the Banking Act.

[ADI] foreign-owned ADI means an ADI in relation to which an approval has been given, under section 14 of the Financial Sector (Shareholdings) Act 1998, for a bank that is not locally incorporated to hold a stake of more than 20 per cent in the ADI.

[LI] friendly society has the meaning given in section 16C of the Life Insurance Act.

[ADI, GI, LI, PHI] FSCODA means the Financial Sector (Collection of Data) Act 2001.

[LI] funeral bond business means policies providing continuous insurance against the contingency of death on terms and conditions agreed at the commencement of the policy, where:

[LI] general fund means the management fund for a friendly society or the shareholders’ fund for a life company other than a friendly society.

[PHI] general fund consists of the operations of a private health insurer that do not form part of a health benefits fund of the private health insurer. This includes assets, liabilities, revenue and expenses not attributed to a health benefits fund.

[GI] general insurer has the meaning given in section 11 in the Insurance Act.

[ADI] general market risk means the risk of loss owing to changes in the general level of market prices or interest rates. It arises from positions in interest rate, equities, foreign exchange and commodities.

[ADI] general provisions means provisions held against performing exposures that represent a purely forward-looking amount for future losses that are presently unidentified.

[PHI] general treatment has the same meaning as in the Private Health Insurance Act 2007 (PHI Act).

[GI] GI Prudential Standards are all prudential standards made under section 32 of the Insurance Act.

[PHI] gross margin means the difference between accrued premium and benefits incurred (inclusive of State levies), as a proportion of accrued premium.

[LI] gross policy liability is as defined in Prudential Standard LPS 340 Valuation of Policy Liabilities.

[ADI] group refers to a Level 2 group or a Level 3 group and, more generally, refers to a corporate group that comprises more than one company that are related bodies corporate within the meaning of section 50 of the Corporations Act.

[GI] group means a Level 2 group or Level 3 group.

[GI] Group Actuary is as defined in Prudential Standard CPS 320 Actuarial and Related Matters.

[GI] Group Auditor is as defined in Prudential Standard GPS 310 Audit and Related Matters.

[ADI, GI] head of a group means a Level 2 Head or Level 3 Head, as relevant.

[PHI] health benefits fund has the same meaning as in the PHIPS Act.

[PHI] health insurance business (HIB) has the same meaning as in the PHIPS Act.

[PHI] health-related business has the same meaning as in the PHIPS Act.

[PHI] health-related insurance business (HRIB) means the insurance component of health-related business such as insurance for overseas visitors and students.

[PHI] hospital treatment has the same meaning as in the PHI Act.

[GI] ICAAP report is as described in Prudential Standard GPS 110 Capital Adequacy.

[LI] ICAAP report is as described in Prudential Standard LPS 110 Capital Adequacy.

[GI] ICAAP summary statement is as described in Prudential Standard GPS 110 Capital Adequacy.

[LI] ICAAP summary statement is as described in Prudential Standard LPS 110 Capital Adequacy.

[LI] illiquidity premium is as defined in Prudential Standard LPS 112 Capital Adequacy: Measurement of Capital.

[LI] immediate life annuity is an annuity that is not unbundled investment business and is not a variable annuity, where the next annuity payment is due within 12 months and payments continue until the death of the life insured. This includes deferred annuities that have commenced payment.

[GI] Insurance Act means the Insurance Act 1973.

[GI] insurance business has the meaning as in the Insurance Act.

[GI] Insurance Concentration Risk Charge means the risk charge determined under Prudential Standard GPS 116 Capital Adequacy: Insurance Concentration Risk Charge.

[LI] insurance contract means a contract under which one party (the insurer) accepts significant insurance risk from another party (the policy owner) by agreeing to compensate the policy owner if a specified uncertain future event (the insured event) adversely affects the policy owner.

[GI] insurance group means a group of entities comprising:

within a corporate group. There may be more than one insurance group within a corporate group. An insurance group includes but is not necessarily limited to a Level 2 insurance group as defined in this Prudential Standard.

[GI] insurance group captive means an insurer that:

[LI] insurance risk refers to risk, other than financial risk, transferred from the holder of a contract to the issuer.

[GI] Insurance Risk Charge means the risk charge determined under Prudential Standard GPS 115 Capital Adequacy: Insurance Risk Charge.

[LI] Insurance Risk Charge means the risk charge determined under Prudential Standard LPS 115 Capital Adequacy: Insurance Risk Charge.

[PHI] Insurance Risk Charge means the risk charge determined under Prudential Standard HPS 115 Capital Adequacy: Insurance Risk Charge.

[GI] insurer means a general insurer as defined in the Insurance Act, other than in Prudential Standard CPS 320 Actuarial and Related Matters.

[ADI] Internal Capital Adequacy Assessment Process (ICAAP) is as described in Prudential Standard APS 110 Capital Adequacy.

[GI] Internal Capital Adequacy Assessment Process (ICAAP) is as described in Prudential Standard GPS 110 Capital Adequacy.

[LI] Internal Capital Adequacy Assessment Process (ICAAP) is as described in Prudential Standard LPS 110 Capital Adequacy.

[PHI] Internal Capital Adequacy Assessment Process (ICAAP) is as described in Prudential Standard HPS 110 Capital Adequacy.

[ADI] Internal ratings-based (IRB) approach to credit risk refers to the approach to credit risk, as defined in Prudential Standard APS 113 Capital Adequacy: Internal Ratings-based Approach to Credit Risk.

[GI] international business of a Level 2 insurance group means, for the purposes of the prudential requirements applicable to Level 2 insurance groups, insurance business carried on by any entity within the group that is not authorised under the Insurance Act.

[LI] investment account benefit has the meaning given in the Dictionary to the Life Insurance Act.

[LI] investment account contract has the meaning given in the Dictionary to the Life Insurance Act.

[LI] investment fluctuation reserve means a reserve used for smoothing discretionary additions for non-participating benefits. For the purpose of the capital adequacy standards the investment fluctuation reserve is defined to be the difference between the value of the assets administered for the purpose of a subcategory and the aggregate value of the accounts under the policies belonging to that subcategory.

[LI] investment management expenses means the fixed and variable expenses of a life company to the extent they are, either directly or indirectly, referable to managing the company’s investment portfolio.

[LI] investment performance guarantee means an investment performance guarantee in accordance with section 42 of the Life Insurance Act.

[LI] investment-linked benefit has the meaning given in the Dictionary to the Life Insurance Act.

[LI] investment-linked contract has the meaning given in the Dictionary to the Life Insurance Act.

[ADI] IRB approval refers to the written approval from APRA for an ADI to adopt the IRB approach.

[ADI] IRRBB means interest rate risk in the banking book: the risk of loss in earnings or in the economic value on banking book items as a consequence of movements in interest rates.

[ADI] legal risk includes, but is not limited to, exposure to fines, penalties or punitive damages resulting from supervisory actions as well as ordinary damages in civil litigation, related legal costs and private settlements.

[GI] lenders mortgage insurance has its ordinary commercial meaning and includes insurance under a policy that protects a lender from losses in the event of borrower default on a loan secured by a mortgage over residential or other property.

[GI] lenders mortgage insurer means an insurer that has written or reinsured, or proposes to write or reinsure, policies of lenders mortgage insurance.

[ADI] Level 1 means either the ADI itself or the ELE.

[GI] Level 1 insurer, for the purposes of the prudential requirements applicable to Level 2 insurance groups, means an individual insurer that is authorised under the Insurance Act and is part of a Level 2 insurance group.

[ADI] Level 2 means either:

unless APRA otherwise determines, in writing, a different Level 2 composition for a group of companies of which the ADI is a member.

[ADI] Level 2 group means the entities that comprise Level 2.

[GI] Level 2 group means the entities that comprise a Level 2 insurance group.

[ADI] Level 2 Head means:

[GI] Level 2 Head means the parent entity of a Level 2 insurance group.

[GI] Level 2 insurance group is as defined in Attachment A to this Prudential Standard.

[ADI, GI, LI] Level 3 group means the institutions determined by APRA to be members of a Level 3 group, whether determined by reference to individual institutions and/or classes of institution.

APRA may determine a Level 3 group where it considers that material activities are performed within the group across more than one prudentially regulated industry and/or in one or more non-prudentially regulated industries, to ensure that the ability of the group’s prudentially regulated institutions to meet their obligations to depositors, policyholders or RSE beneficiaries is not adversely impacted by risks emanating from the group, including its non-prudentially regulated institutions.

[ADI] Level 3 Head means an ADI or authorised NOHC under the Banking Act determined by APRA to be Level 3 Head of a Level 3 group.

[GI] Level 3 Head means a general insurer or authorised NOHC under the Insurance Act determined by APRA to be Level 3 Head of a Level 3 group.

[LI] Level 3 Head means a life company or registered NOHC under the Life Insurance Act determined by APRA to be Level 3 Head of a Level 3 group.

[ADI, GI, LI] Level 3 institution means an institution that is a member of the Level 3 group.

[ADI] Level 3 means the conglomerate group at the widest level.

[LI] life business has the meaning given in the Dictionary to the Life Insurance Act.

[LI] life company has the meaning given in the Dictionary to the Life Insurance Act.

[LI] Life Insurance Act means the Life Insurance Act 1995.

[LI] life insurance contract means an insurance contract or a financial instrument with a discretionary participation feature which is regulated under the Life Insurance Act.

[LI] life investment contract means a contract other than a life insurance contract which is regulated under the Life Insurance Act.

[ADI, GI] limited assurance is as defined according to Framework for Assurance Engagements issued by the AUASB.

[ADI] listed refers to an institution admitted to, and not removed from, a securities exchange.

[ADI] locally-incorporated ADI refers to an ADI that is incorporated in Australia or in a State or Territory of Australia, by or under Commonwealth, State or Territory legislation.

[LI] long term risk business refers to policies providing continuous insurance against the contingency of death, other than solely by accident, on terms and conditions agreed at the commencement of the policy, where:

Maintenance expenses include all operating costs and expenses other than acquisition expenses and investment management expenses.

[PHI] management expenses means the expenses associated with the management of the insurer. This includes claims handling expenses, and does not include benefits incurred, taxes or expenses ceded through a reinsurance arrangement.

[ADI] mark-to-model refers to any valuation that has to be benchmarked, extrapolated or otherwise calculated from a market input.

[ADI] material currency means a currency for which the total book value of an ADI’s banking book items in that currency is more than five per cent of the total book value of all banking book items. In determining whether a currency is material, the effect of currency hedges that reduce foreign currency exposure may be taken into account, provided those hedges are effective.

[PHI] material risks are those risks that could have a material impact, both financial and non-financial on the APRA-regulated institution, or on the interests of depositors and/or policy holders of the APRA-regulated institution. Material risks may include, but are not limited to, the examples included in Prudential Standard CPS 220 Risk Management.

[LI] minimum paid-up value is as defined in Prudential Standard LPS 360 Termination Values, Minimum Surrender Values and Paid-up Values.

[LI] minimum surrender value is as defined in Prudential Standard LPS 360 Termination Values, Minimum Surrender Values and Paid-up Values.

[LI] minimum termination value is as defined in Prudential Standard LPS 360 Termination Values, Minimum Surrender Values and Paid-up Values.

[ADI] model approval refers to the written approval from APRA to an ADI to adopt an internal model approach to a particular risk.

[ADI] net credit balance has the meaning in section 5 of the Banking Act.

[LI] net life contract liabilities equals the sum of the insurance, reinsurance and investment contract liabilities (net of insurance and reinsurance assets) disclosed in the statutory accounts determined under Australian Accounting Standards.

[ADI] netting refers to the process under a netting agreement of combining all relevant outstanding transactions between two counterparties and reducing them to a single net sum for a party to either pay or receive.

[GI, PHI] non-APRA-authorised reinsurer means any reinsurer that is not an APRA-authorised reinsurer.

[ADI] non-consolidated subsidiaries is as defined in Attachment A to this Prudential Standard.

[ADI] non-operating holding company (NOHC) has the meaning in section 5 of the Banking Act.

[GI] non-operating holding company (NOHC) has the meaning in the Insurance Act.

[LI] non-operating holding company (NOHC) has the meaning in the Life Insurance Act.

[PHI] non-operating holding company (NOHC) has the meaning in the Insurance Act.

[LI] non-participating benefit has the meaning given in section 15 of the Life Insurance Act.

[GI, PHI] non-reinsurance recoveries are recoveries determined under Prudential Standard CPS 320 Actuarial and Related Matters that do not relate to exposures to a reinsurer.

[ADI] non-significant financial institution (non-SFI) means an ADI or authorised NOHC that is not a significant financial institution.

[GI] non-significant financial institution (non-SFI) means an insurer, authorised NOHC or parent entity of a Level 2 insurance group that is not a significant financial institution.

[LI] non-significant financial institution (non-SFI) means a life company or registered NOHC that is not a significant financial institution.

[PHI] non-significant financial institution (non-SFI) means a private health insurer that is not a significant financial institution.

[ADI] offshoring means the outsourcing by an ADI of a material business activity associated with its Australian business to a service provider (including a related body corporate) where the outsourced activity is to be conducted outside Australia.

[LI] operating profit has the same meaning as in section 58 of the Life Insurance Act.

[ADI] operational risk means the risk of loss resulting from inadequate or failed internal processes, people and systems or from external events. This definition includes legal risk but excludes strategic and reputational risks.

[GI] Operational Risk Charge is the risk charge determined under Prudential Standard GPS 118 Capital Adequacy: Operational Risk Charge.

[LI] Operational Risk Charge is the risk charge determined under Prudential Standard LPS 118 Capital Adequacy: Operational Risk Charge.

[PHI] Operational Risk Charge is the risk charge determined under Prudential Standard HPS 118 Capital Adequacy: Operational Risk Charge.

[ADI] ordinary shares for Regulatory Capital purposes must meet the criteria in Attachment B to Prudential Standard APS 111 Capital Adequacy: Measurement of Capital.

[LI] other liability refers to a liability according to general accounting concepts, other than a policy liability or a liability in respect of an instrument that is eligible to be included in the capital base.

[PHI] outstanding claims risk size margin of a health benefits fund is as defined in Prudential Standard HPS 115 Capital Adequacy: Insurance Risk Charge.

[GI] parent entity is as defined in Attachment A to this Prudential Standard.

[LI] participating benefit has the same meaning as in section 15 of the Life Insurance Act.

[LI] participating policy liability is as defined in Prudential Standard LPS 112 Capital Adequacy: Measurement of Capital.

[GI] partnership captive means an insurer that:

[PHI] PHI Act means the Private Health Insurance Act 2007.

[PHI] PHIPS Act means the Private Health Insurance (Prudential Supervision) Act 2015.

[GI, PHI] policy administration expenses are costs that a general insurer, Level 2 insurance group or private health insurer expects to incur in administering policies, which includes an appropriate allocation of business overheads such as corporate office overheads. This includes, but is not limited to, policy management and administration expenses to allow for the cost of managing unexpired policies for which the entity is on risk.

[PHI] policy holder has the same meaning as in the PHIPS Act.

[ADI, GI, LI] policyholder means a policyholder as referred to in the Insurance Act or a policy owner as referred to in the Life Insurance Act.

[LI] policy liability has the same meaning as in the Dictionary to the Life Insurance Act.

[LI] policy owner profit share means the entitlement of the policy owner to share in the profits emerging from the benefits.

[ADI] PPF provider or purchased payment facility provider refers to an ADI with authority to provide purchased payment facilities.

[GI] prescribed capital amount is as defined in Prudential Standard GPS 110 Capital Adequacy.

[LI] prescribed capital amount is as defined in Prudential Standard LPS 110 Capital Adequacy.

[PHI] prescribed capital amount is as defined in Prudential Standard HPS 110 Capital Adequacy.

[ADI] Privacy Act refers to the Privacy Act 1988.

[PHI] private health insurer has the same meaning as in the PHIPS Act.

[PHI] probability of adequacy means the percentile required to meet individual elements of Prudential Standard HPS 110 Capital Adequacy.

[ADI] Prudential Capital Requirement (PCR) means the minimum amount of Regulatory Capital that an ADI or NOHC must hold as defined in Prudential Standard APS 110 Capital Adequacy.

[GI] Prudential Capital Requirement (PCR) means the minimum amount of capital an insurer or Level 2 insurance group must hold as defined in Prudential Standard GPS 110 Capital Adequacy.

[LI] Prudential Capital Requirement (PCR) is as defined in Prudential Standard LPS 110 Capital Adequacy.

[PHI] Prudential Capital Requirement (PCR) means the minimum amount of capital that an insurer must hold as defined in Prudential Standard HPS 110 Capital Adequacy.

[ADI] prudential disclosures means the minimum requirements relating to the disclosure by an ADI of information about its capital adequacy under Prudential Standard APS 330 Capital Adequacy: Public Disclosure of Prudential Information.

[GI] prudential matters has the same meaning as in the Insurance Act.

[ADI] prudential requirements include requirements imposed by the Banking Act, prudential standards made under the Banking Act, reporting standards made under FSCODA, conditions on the ADI's authorisation and any other requirements imposed by APRA in writing.

[GI] prudential requirements include requirements imposed by the Insurance Act, the Insurance Regulations 2002, prudential standards determined under the Insurance Act, the FSCODA, reporting standards, conditions imposed under the Insurance Act on the insurer's authorisation, directions issued by APRA pursuant to the Insurance Act and any other requirements imposed by APRA in writing.

[LI] prudential requirements include requirements imposed by the Life Insurance Act, the Life Insurance Regulations 1995, prudential standards determined under the Life Insurance Act, the FSCODA, reporting standards made under FSCODA, conditions imposed under the Life Insurance Act on the life company's authorisation, directions issued by APRA pursuant to the Insurance Act and other requirements imposed by APRA in writing.

[PHI] prudential requirements include requirements imposed by the PHIPS Act, prudential standards and APRA rules made under the PHIPS Act, reporting standards made under FSCODA, conditions imposed at the time of registration under the PHIPS Act and any other requirements imposed by APRA in writing.

[ADI, GI, LI] prudentially regulated institution means an ADI, general insurer, life company, RSE licensee, authorised NOHC under the Banking Act or the Insurance Act, or registered NOHC under the Life Insurance Act.

[ADI] RBA refers to the Reserve Bank of Australia.

[ADI] reasonable assurance is defined in accordance with the Framework for Assurance Engagements issued by the AUASB.

[LI] registered NOHC has the same meaning as in the Life Insurance Act.

[LI] regular premium business means business under life policies where:

[GI] regulated institutions refers collectively to both insurers and Level 2 insurance groups.

[ADI] Regulatory Capital is as defined in Prudential Standard APS 111 Capital Adequacy: Measurement of Capital.

[GI, LI, PHI] reinsurance refers to all arrangements where some part of individual or aggregate insurance risks are ceded to another company or companies and include cessions of direct writing companies to reinsurance companies or other direct writing companies and parent companies as well as retrocessions of reinsurers to their parent companies or other reinsurers.

[GI] Reinsurance Arrangements Statement is as defined in Prudential Standard GPS 230 Reinsurance Management.

[GI, PHI] reinsurance assets in relation to an insurer or an entity that carries on international business within a Level 2 insurance group or in relation to a private health insurer comprises:

[GI] reinsurance classes of business are as defined in Attachment B to this Prudential Standard.

[GI] Reinsurance Management Strategy is as defined in Prudential Standard GPS 230 Reinsurance Management.

[GI] reinsurance recoverables means any amounts due to an insurer, or to an entity that carries on international business within a Level 2 insurance group, from a reinsurer that arise from the recognition of outstanding claims liabilities referred to in the capital standards and Prudential Standard CPS 320 Actuarial and Related Matters. This is distinguished from expected reinsurance recoveries and forms part of reinsurance assets.

[PHI] reinsurance recoverables means any amounts due to a private health insurer from a reinsurer that arise from the recognition of outstanding claims liabilities referred to in the capital standards and Prudential Standard CPS 320 Actuarial and Related Matters.

[LI] reinsured best estimate liability means the component of the reinsured policy liability, being the best estimate liability in respect of outwards reinsurance business.

[LI] reinsured policy liability is as defined in Prudential Standard LPS 340 Valuation of Policy Liabilities.

[LI, PHI] reinsurer means any company providing reinsurance, whether a parent company, direct writing company or reinsurance company.

[ADI, GI, LI, PHI] related body corporate or related company has the same meaning as in section 50 of the Corporations Act.

[GI, LI, PHI] related entity means an entity which is a ‘related party’ within the meaning of the relevant Australian Accounting Standards.

[GI] related firms, in the context of appointed auditors, Appointed Actuaries and Reviewing Actuaries, means either two or more firms, or a firm and a body corporate, that have common ownership or management, or where one has a substantial shareholding in the other.

[ADI] relevant group of bodies corporate has the meaning in section 5 of the Banking Act.

[GI, PHI] reporting date is the last day of the relevant reporting period of the general insurer, Level 2 insurance group or private health insurer.

[GI, LI, PHI] reporting period is the period that the general insurer, Level 2 insurance group, life company or private health insurer is required to report under the relevant reporting standards made under FSCODA.

[GI] responsible auditor is as defined in Prudential Standard CPS 520 Fit and Proper.

[PHI] responsible persons has the same meaning as in Prudential Standard CPS 520 Fit and Proper.

[LI] retail business means life business which is not wholesale business.

[GI] Reviewing Actuary means an actuary appointed by an insurer for the purpose of reviewing the AVR under Prudential Standard CPS 320 Actuarial and Related Matters.

[LI] risk business refers to policies that only provide for benefits to be paid to policy owners on the death or disability of the life insured, or if the life insured is found to have a specific disease or injury. The policies must not provide participating benefits or discretionary additions to benefits and must not be traditional business or funeral bond business.

[PHI] risk equalisation is the payments to be made to or receivables expected from the Risk Equalisation Special Account for the relevant period. Risk Equalisation Special Account has the same meaning as in the PHIPS Act.

[ADI, GI, LI, PHI] risk management declaration is as defined in Prudential Standard CPS 220 Risk Management.

[ADI, GI, LI, PHI] risk management framework is as defined in Prudential Standard CPS 220 Risk Management.

[ADI, GI, LI, PHI] risk management strategy is as defined in Prudential Standard CPS 220 Risk Management.

[LI] risk-free best estimate liability is as defined in Prudential Standard LPS 112 Capital Adequacy: Measurement of Capital.

[LI] risk-free discount rate for liabilities denominated in Australian currency means the rate (or rates) based on the yields of Commonwealth Government Securities that relate to the term of the future liability cash flows. If the term of the liability cash flows exceeds the maximum available term of Commonwealth Government Securities, APRA expects other instruments with longer terms to be used as a reference point for the purpose of extrapolation unless the insurer can demonstrate there are no other suitable instruments. Adjustments must be made to remove any allowances for credit risk and illiquidity that are implicit in the yields on these instruments. For foreign liabilities, the rate (or rates) must be based on the yields of highly liquid sovereign risk securities in the currency of the policy liabilities and with counterparty grade 1. If there are no securities satisfying these requirements, other instruments may be used as a reference point. Adjustments must be made to remove any allowances for credit risk and illiquidity that are implicit in the yields on these instruments.

[ADI, GI, LI] RSE means a registrable superannuation entity as defined in the Superannuation Industry (Supervision) Act 1993 (SIS Act).

[ADI, GI, LI] RSE licensee has the meaning given in the Superannuation Industry (Supervision) Act 1993 (SIS Act).

[GI] run-off insurer means an insurer that is closed to new business and has not written renewal business for a period of at least 12 months.

[LI] seed capital means an amount transferred, with the approval of APRA, from the management fund of a friendly society to one of its approved benefits funds for the purpose of meeting the capital standards for the benefit fund.

[PHI] senior management means a person who has or exercises any senior management responsibilities for the private health insurer.

[ADI, GI, LI] senior management means senior managers as defined in Prudential Standard CPS 520 Fit and Proper.

[ADI] senior manager has the meaning in the Banking Act.

[GI] senior manager has the meaning in the Insurance Act.

[LI] senior manager has the meaning in the Life Insurance Act.

[ADI] senior officer outside Australia is the senior nominated officer of a foreign ADI (whether a director or senior executive) outside Australia with delegated authority from the board to be responsible for overseeing the Australian branch operation.

[GI] senior officer outside Australia is as defined in Prudential Standard CPS 510 Governance.

[LI] servicing expense reserve is as defined in Prudential Standard LPS 115 Capital Adequacy: Insurance Risk Charge.

[LI] servicing expenses refers to the combination of maintenance expenses and investment management expenses.

[LI] shareholder profit is the amount of profit attributable to the shareholders.

[LI] shareholder profit share means the entitlement of the shareholder to share in the profit emerging from the benefits.

[LI] shareholders' retained profits (Australian participating) has the meaning given in the Dictionary to the Life Insurance Act.

[LI] shareholders' retained profits (overseas and non-participating) has the meaning given in the Dictionary to the Life Insurance Act.

[ADI] significant financial institution (SFI) means an ADI or authorised NOHC that is either:

[PHI] single equivalent units (SEUs) has the same meaning as in the Private Health Insurance (Risk Equalisation Policy) Rules 2015.

[LI] single premium business is life business which is not regular premium business.

[GI] small insurer means an insurer that satisfies the following criteria:

[ADI] SMEs refers to small and medium-sized enterprises.

[GI, LI, PHI] solicited credit rating means a rating that has been initiated and paid for by the issuer or rated counterparty or a commercial associate of the issuer or rated counterparty.

[LI] solvency standard refers to Prudential Standard LPS 100 Solvency Standard and falls within the meaning of prudential standards in relation to solvency referred to under the Life Insurance Act.

[LI] special purpose review is a review relating to a life company's operations, risk management or financial affairs and is conducted by an Appointed Actuary or another actuary when requested to do so in writing by APRA, under Prudential Standard CPS 320 Actuarial and Related Matters.

[GI, LI, PHI] Special Purpose Vehicle (SPV) refers to an entity that is not a related entity and the activities of which are restricted to the acquisition and financing of specific assets.

[LI] specialist reinsurer refers to a statutory fund of a registered life company where all policies referable to the fund are reinsurance policies and none of the policies is owned by a related entity of the life company.

[ADI] specific provisions means provisions held against non-performing exposures, or performing exposures that represent identified losses.

[GI] Standard Method is as defined in Prudential Standard GPS 110 Capital Adequacy.

[ADI] Standardised Approach to credit risk refers to the approach to credit risk outlined in Prudential Standard APS 112 Capital Adequacy: Standardised Approach to Credit Risk.

[GI, LI, PHI] statutory accounts means the reporting documents that a general insurer, a life company or a private health insurer is required to lodge with APRA under section 13 of FSCODA.

[LI] statutory fund means a statutory fund of a life company other than a friendly society, or an approved benefit fund of a friendly society.

[LI] stressed policy liabilities is as defined in Prudential Standard LPS 115 Capital Adequacy: Insurance Risk Charge.

[ADI, GI] subsidiary has the meaning in the Corporations Act.

[PHI] substantial shareholder means a person with a substantial holding within the meaning given by section 9 of the Corporations Act.

[LI] superannuation business is as defined in the Life Insurance Act.

[GI] supervisory adjustment is as defined in Prudential Standard GPS 110 Capital Adequacy.

[LI] supervisory adjustment is as defined in Prudential Standard LPS 110 Capital Adequacy.

[PHI] supervisory adjustment is as defined in Prudential Standard HPS 110 Capital Adequacy.

[LI] term certain annuity is an annuity that is not unbundled investment business and is not a variable annuity, where the next annuity payment is due within 12 months and payments continue for a fixed term that is not dependent on the survival of the life insured.

[PHI] terminating management has the same meaning as in the PHIPS Act.

[LI] termination value is as defined in Prudential Standard LPS 360 Termination Values, Minimum Surrender Values and Paid-up Values.

[ADI] third party means an entity that is not the ADI or a related body corporate of the ADI.

[ADI] Tier 1 Capital is as defined in Prudential Standard APS 111 Capital Adequacy: Measurement of Capital.

[GI] Tier 1 Capital is as defined in Prudential Standard GPS 112 Capital Adequacy: Measurement of Capital.

[LI] Tier 1 Capital is as defined in Prudential Standard LPS 112 Capital Adequacy: Measurement of Capital.

[PHI] Tier 1 Capital is as defined in Prudential Standard HPS 112 Capital Adequacy: Measurement of Capital.

[ADI] Tier 2 Capital is as defined in Prudential Standard APS 111 Capital Adequacy: Measurement of Capital.

[GI] Tier 2 Capital is as defined in Prudential Standard GPS 112 Capital Adequacy: Measurement of Capital.

[LI] Tier 2 Capital is as defined in Prudential Standard LPS 112 Capital Adequacy: Measurement of Capital.

[PHI] Tier 2 Capital is as defined in Prudential Standard HPS 112 Capital Adequacy: Measurement of Capital.

[ADI] Total Capital is as defined in Prudential Standard APS 111 Capital Adequacy: Measurement of Capital.

[LI] traditional business refers to whole of life and endowment policies with either a single premium or with regular premiums that are level throughout the term for which premiums are payable. Regular premiums are level if each premium is the same, or if the premium can only be increased due to indexation of the sum insured or policy fee, or because the life company increases its premium rates. Traditional business excludes funeral bond business, unbundled investment business, fixed term/rate business and annuity business.

[LI] unbundled investment business refers to life business that is not risk business, where the costs of the investment and the other services provided under the policy are separately disclosed to policy owners. Unbundled investment business excludes variable annuities and funeral bond business, but includes all other types of investment account business and investment-linked business.

[GI, PHI] unclosed business refers to premium revenue from insurance policies that have not yet been processed, but for which the general insurer, Level 2 insurance group or private health insurer is liable at the valuation date. There may be insufficient information available to report an exact amount of premium.

[LI, PHI] unpaid premium means the value of premiums due but not received. Premiums are defined as gross of commissions and before profit share rebates (for example included in group insurance and reinsurance contracts issued). Premiums must also be inclusive of stamp duty, policy fees, loadings and discounts.

[LI] value of supporting assets means the value of assets determined in accordance with Part C of Prudential Standard LPS 340 Valuation of Policy Liabilities as being available to support the life company’s participating business.

[LI] variable annuity means a policy with benefits calculated by reference to the value of the units allocated to the policy, but the benefits may exceed the value of those units in specified circumstances.

[LI] wholesale business means superannuation business where the effective purchasing decision is made by a trustee or company except that where the number of members has always been less than five it is retail business.

[ADI, GI, LI] wider conglomerate group means the group comprising all institutions within a consolidated group at the widest level to which the Level 3 group belongs.

[GI] yearly statutory accounts has the same meaning as in the Insurance Act.

[PHI] yearly statutory accounts has the same meaning as in FSCODA.

Fire

Includes all policies normally classified as 'Fire' and includes:

ISR

Standard policy wordings exist for this type of policy. All policies that contain such standard wordings or substantially similar wording are to be classified as ISR.

This class consists only of CTP business.

PI covers professionals against liability incurred as a result of errors and omissions made in performing professional services that has resulted in economic losses suffered by third parties.

Cyber insurance provides first party and third-party coverage in respect to the insured’s exposures relating to indemnified cyber events.