CA-5.1.9
The level of claims provisions must be set such that:
(a) No adverse run-off deviation is envisaged;
(b) The provision is determined having regard to the range of uncertainty as to the eventual outcome for the category of business in question; and
(c) In circumstances where there exists considerable uncertainty concerning future events, a degree of caution is exercised such that liabilities are not understated.
(d) If it is less than the aggregate case-by-case provision for claims reported set up by the claims manager, the insurance firm must disclose in writing to the CBB the justification for such a release of reserves.
Amended: October 2009
Amended: January 2007
Amended: January 2007