Question ID: 395
Regulation Reference: (EU) No 2015/2450 - templates for the submission of information to the supervisory authorities
Article: 35, 1, 250
Template: S.28.01
Status: Final
Date of submission: 10 Dec 2015
Question
MCR NL calculation (DA art. 250 (1)(c), templates S.28.01 and S.28.02) is based on net written premiums as a volume measure. However definition of written premiums (DA art. 1 point 11) for reinsurance contracts – both when reinsurance undertakings calculate premiums to be received from cedents (inward reinsurance) and when insurance undertakings calculated reinsurers’ share in order to calculate net written premiums (outward reinsurance) may be understood in 2 different ways:
Option 1. “premiums due” are recognized according to last date when cedent should pay premiums to reinsurer,
Option 2. “premiums due” are recognized according to last date of premiums payment for underlying insurance contract.
Which option is correct understanding of written premiums for reinsurance contracts?
EIOPA answer
The definition of written premiums for reinsurance contracts – both when reinsurance undertakings calculate premiums to be received from cedents (inward reinsurance) and when insurance undertakings calculated reinsurers’ share in order to calculate net written premiums (outward reinsurance) should follow the definition of Article 1, point 11, and “premiums due” should be are recognised according to last date when cedent should pay premiums to reinsurer.