• PIN APP9 PIN APP9 CALCULATION OF ADGM BUSINESS RISK CAPITAL REQUIREMENT

    • PIN A9.1 PIN A9.1 Purpose and general provisions

      • PIN A9.1.1 PIN A9.1.1

        This appendix applies to all Insurers to which Rule 4.6 applies.

        • Guidance

          1. This appendix sets out the manner in which an Insurer that is not an ADGM Incorporated Insurer is required to calculate its ADGM Business Risk Capital Requirement. The basis of calculation is analogous to the basis of calculation of elements of the Minimum Capital Requirement for Insurers that are not Cell Companies, as set out in APP4.
          2. The ADGM Business Risk Capital Requirement is calculated with reference to the insurance activities of the Insurer, carried out through its establishment in ADGM, without deduction for reinsurances.

    • PIN A9.2 PIN A9.2 ADGM Business Risk Capital Requirement

      • PIN A9.2.1

        An Insurer must calculate its ADGM Business Risk Capital Requirement as the sum of the Insurer's ADGM underwriting risk component, the Insurer's ADGM reserving risk component and the Insurer's ADGM Long-Term Insurance risk component.

      • PIN A9.2.2

        In calculating ADGM Business Risk Capital Requirement:

        (a) no account must be taken of Contracts of Insurance effected by the Insurer, other than through an establishment in ADGM; and
        (b) no account must be taken of contracts of reinsurance entered into by the Insurer as cedant, regardless of where those contracts of reinsurance were entered into.

    • PIN A9.3 PIN A9.3 ADGM underwriting risk component

      • Guidance

        The ADGM underwriting risk component requires an Insurer to demonstrate the availability of capital to address the risk that the cost of claims on Contracts of Insurance entered into as Insurer through an establishment in ADGM will vary from the cost implicit in the premiums being charged.

      • PIN A9.3.1

        An Insurer must calculate its ADGM underwriting risk component according to the method set out in Rule A4.10, subject to the modifications set out in Rules A9.2.2(a) and (b).

    • PIN A9.4 PIN A9.4 ADGM reserving risk component

      • Guidance

        The ADGM reserving risk component requires an Insurer to demonstrate the availability of capital to address the risk that the cost of claims in respect of contracts entered into as Insurer through an establishment in ADGM will vary from the amounts recorded as liabilities in the Insurer's balance sheet.

      • PIN A9.4.1

        An Insurer must calculate its ADGM reserving risk component according to the method set out in Rule A4.11, subject to the modifications set out in Rules A9.2.2(a) and (b).

    • PIN A9.5 PIN A9.5 ADGM long-term insurance risk component

      • PIN A9.5.1

        An Insurer must calculate its ADGM Long-Term Insurance risk component according to the method set out in Rule A4.12, subject to the modifications set out in Rules A9.2.2(a) and (b).