LLD 21.3 Market risk in insurance

PRU 4.2 applies to managing agents and to the Society in accordance with:

1. (1)

   for managing agents, LLD 16.3.3 R, subject to LLD 21.3.4 R below; and

2. (2)

   for the Society, LLD 16.3.1 R.

Managing agents must calculate the amount of the resilience capital requirement for the long-term insurance business carried on through the syndicates they manage.

The Society must determine the resilience capital requirement for the insurance business of each member under PRU 4.2.10 R as the member's proportionate share of the resilience capital requirement calculated by the managing agent for the long-term insurance business carried on through the syndicate.

For the purposes of PRU 4.2.53 R, a managing agent must ensure that:

1. (1)

   syndicate liabilities are covered by matching syndicate assets as required by PRU 4.2.53 R; or that

2. (2)

   it immediately notifies to the Society the nature and extent of any syndicate liabilities not covered by matching assets under (1).

On receipt of a notification by a managing agent under LLD 21.3.4 R (2), the Society must ensure that the liabilities in respect of the insurance business of the members in aggregate are covered with matching assets complying with PRU 4.2.53 R.