Financial Sector (Collection of Data) (reporting standard) determination No. 103 of 2013
Reporting Standard GRS 460.0_G Reinsurance Assets by Counterparty (Level 2 Insurance Group)
Financial Sector (Collection of Data) Act 2001
I, Charles Littrell, delegate of APRA, under paragraph 13(1)(a) of the Financial Sector (Collection of Data) Act 2001 (the Act) DETERMINE Reporting Standard GRS 460.0_G Reinsurance Assets by Counterparty (Level 2 Insurance Group), in the form set out in the Schedule, which applies to the financial sector entities to the extent provided in paragraph 3 of the reporting standard.
Under section 15 of the Act, I DECLARE that the reporting standard shall begin to apply to those financial sector entities on 31 December 2013.
This instrument commences on 31 December 2013.
Dated: 13 December 2013
[Signed]
Charles Littrell
Executive General Manager
Policy, Statistics and International
Interpretation
In this Determination:
APRA means the Australian Prudential Regulation Authority.
financial sector entity has the meaning given in section 5 of the Act.
Schedule
Reporting Standard GRS 460.0_G Reinsurance Assets by Counterparty (Level 2 Insurance Group) comprises the 11 pages commencing on the following page.
Reporting Standard GRS 460.0_G
Reinsurance Assets by Counterparty (Level 2 Insurance Group)
Objective of this Reporting Standard
This Reporting Standard sets out the requirements for the provision of information to APRA relating to a Level 2 insurance group’s exposures to reinsurance counterparties.
It includes Form GRF 460.0_G Reinsurance Assets by Counterparty (G) and associated specific instructions and must be read in conjunction with the general instruction guide.
Authority
1. This Reporting Standard is made under section 13 of the Financial Sector (Collection of Data) Act 2001.
Purpose
2. Information collected in Form GRF 460.0_G Reinsurance Assets by Counterparty (G) (GRF 460.0_G) is used by APRA for the purposes of prudential supervision.
Application and commencement
3. This Reporting Standard applies to the parent entity of a Level 2 insurance group as defined in Prudential Standard GPS 001 Definitions (GPS 001).
4. This Reporting Standard applies for reporting periods ending on or after 31 December 2013.
5. The parent entity of a Level 2 insurance group is required to ensure that each requirement in this Reporting Standard is complied with.
Information required
6. The parent entity of a Level 2 insurance group must provide APRA with the information required by GRF 460.0_G in respect of the Level 2 insurance group for each reporting period.
Forms and method of submission
7. The information required by this Reporting Standard must be given to APRA in electronic format using the ‘Direct to APRA’ application or, where ‘Direct to APRA’ is not available, by a method notified by APRA prior to submission.
Note: the ‘Direct to APRA’ application software (also known as ‘D2A’) may be obtained from APRA.
Reporting periods and due dates
8. Subject to paragraph 9, the parent entity of a Level 2 insurance group must provide the information required by this Reporting Standard in respect of each financial year of the Level 2 insurance group.
9. If, having regard to the particular circumstances of a Level 2 insurance group, APRA considers it necessary or desirable to obtain information more or less frequently than as provided by paragraph 8, APRA may change the reporting periods, or specify reporting periods, for the particular Level 2 insurance group.
10. The information required by this Reporting Standard must be provided to APRA:
(a) within the time stated in Reporting Standard GRS 001 Reporting Requirements (GRS 001); or
(b) in the case of information provided in accordance with paragraph 9, within the time specified by APRA.
11. APRA may grant the parent entity of a Level 2 insurance group an extension of a due date, in which case the new due date for the provision of the information will be the date on the notice of extension.
Quality control
12. All information provided by the parent entity of a Level 2 insurance group under this Reporting Standard must be subject to systems, processes and controls developed by the Level 2 insurance group for the internal review and authorisation of that information. It is the responsibility of the Board and senior management of the parent entity of the Level 2 insurance group to ensure that an appropriate set of policies and procedures for the authorisation of information submitted to APRA is in place.
13. Under Prudential Standard GPS 310 Audit and Related Matters (GPS 310), the Group Auditor of a Level 2 insurance group is not ordinarily required to provide a limited assurance review in relation to information provided by the parent entity of the Level 2 insurance group under this Reporting Standard.
Authorisation
14. When an officer or agent of the parent entity of a Level 2 insurance group provides the information required by this Reporting Standard using the ‘Direct to APRA’ software, it will be necessary for the officer or agent to digitally sign the relevant information using a digital certificate acceptable to APRA.
15. If the information required by this Reporting Standard is provided by an agent who submits using the ‘Direct to APRA’ software on the parent entity’s behalf, the parent entity of the Level 2 insurance group must:
(a) obtain from the agent a copy of the completed form with the information provided to APRA; and
(b) retain the completed copy.
16. An officer or agent of the parent entity of a Level 2 insurance group who submits the information under this Reporting Standard for, or on behalf of, the parent entity of the Level 2 insurance group must be authorised by either:
(a) the Principal Executive Officer of the parent entity of the Level 2 insurance group; or
(b) the Chief Financial Officer of the parent entity of the Level 2 insurance group.
Variations
17. APRA may vary the reporting requirements of GRF 460.0_G in relation to a Level 2 insurance group.
Interpretation
18. In this Reporting Standard:
(a) unless the contrary intention appears, words and expressions have the meanings given to them in GPS 001; and
(b) APRA means the Australian Prudential Regulation Authority established under the Australian Prudential Regulation Authority Act 1998;
Chief Financial Officer means the chief financial officer of the parent entity of the Level 2 insurance group, by whatever name called;
financial year means the financial year (within the meaning in the Corporations Act 2001) of the parent entity of the Level 2 insurance group;
general instruction guide refers to the general instruction guide set out in Attachment A of GRS 001;
Group Auditor has the meaning given in GPS 310;
Principal Executive Officer means the principal executive officer of the parent entity of the Level 2 insurance group, by whatever name called, and whether or not he or she is a member of the governing board of the parent entity of the Level 2 insurance group; and
reporting period means a period mentioned in paragraph 8 or, if applicable, paragraph 9.
19. Where this Reporting Standard provides for APRA to exercise a power or discretion, this power or discretion is to be exercised in writing.
GRF_460_0_G: Reinsurance Assets by Counterparty (G)
Australian Business Number
Institution Name
Reporting Period
Scale Factor
Reporting Consolidation
Annual
Thousands of dollars no decimal place
Level 1 / Level 2
Name of counterparty (reinsurer)
Reinsurer identifier
Counterparty group name
APRA counterparty grade
Major form of collateral / guarantee
Amount of collateral / guarantee
APRA counterparty grade after collateral / guarantee
Counterparty domicile
Group domicile
Central estimate of reinsurance recoverables
Net reinsurance recoverable on paid claims overdue for more than 6 months - central estimate
Reinsurance recoverable outstanding from second annual balance date after the event - central estimate
Deferred reinsurance expense
(1)
(2)
(3)
(4)
(5)
(6)
(7)
(8)
(9)
(10)
(11)
(12)
(13)
Other
Total
Reporting Form GRF 460.0_G
Reinsurance Assets by Counterparty (G)
Instructions
These instructions assist completion of Reporting Form GRF 460.0_G Reinsurance Assets by Counterparty (GRF 460.0_G). GRF 460.0_G collects information relating to a regulated institution’s exposure to individual reinsurance counterparties. Information reported in GRF 460.0_G is primarily required for prudential purposes.
These instructions must be read in conjunction with the general instruction guide.
Audit matters
As a result of Insurance (exemption) determination No. 2 of 2013, the Appointed Auditor of a general insurer is not required to audit, or provide a certificate in relation to, information provided by the general insurer under Reporting Standard GRS 460.0 Reinsurance Assets by Counterparty. Under Prudential Standard GPS 310 Audit and Related Matters (GPS 310), the Group Auditor of a Level 2 insurance group is not required to provide a limited assurance review in relation to information provided by the parent entity of the Level 2 insurance group under Reporting Standard GRS 460.0_G Reinsurance Assets by Counterparty (Level 2 Insurance Group). APRA, however, may exercise its power under GPS 310 to require the Appointed Auditor or Group Auditor to undertake a special purpose review of the systems, processes and controls surrounding the completion of Reporting Form GRF 460.0 Reinsurance Assets by Counterparty (GRF 460.0) and GRF 460.0_G, or the data contained within GRF 460.0 and GRF 460.0_G.
Reporting Level
GRF 460.0_G must be completed by all Level 2 insurance groups.
Specific instructions
Terms highlighted in bold italics indicate that the definition is provided in these instructions. Additional definitions are provided at the end of these instructions.
Reporting Practice Guide GRPG 460 Reinsurance Counterparty Data Collection provides guidance to assist regulated institutions in completing GRF 460.0_G.
Reinsurance assets by counterparty
For the purposes of GRF 460.0_G, it is acceptable for a regulated institution to report less than 100 per cent of the regulated institution’s total exposure to individual reinsurance counterparties. However, at a minimum, the regulated institution must report exposures to individual reinsurance counterparties such that the aggregate of the amount reported on the reporting form represents at least 95 per cent of the sum of the regulated institution’s total central estimate of reinsurance recoverables (including recoverables on paid claims overdue for more than six months and recoverables outstanding from the second annual balance date after the event) and deferred reinsurance expense.
Regulated institutions are only to include reinsurance recoverables on GRF 460.0_G that are classed as reinsurance on Reporting Form GRF 300.0 Statement of Financial Position or Reporting Form GRF 300.0_G Statement of Financial Position (G).
Reporting basis: report balances for Column 6 and Columns 10 to 13 as at the end of the financial year.
Unit of measurement: report amounts in Column 6 and Columns 10 to 13 as thousands of dollars.
Report each reinsurance counterparty as a separate line item.
For each reinsurance counterparty report the Name of counterparty (reinsurer) in column 1, the Reinsurer identifier in column 2, the Counterparty group name in column 3, the APRA counterparty grade in column 4, the Major form of collateral / guarantee in column 5, the Amount of collateral / guarantee in column 6, the APRA counterparty grade after collateral / guarantee in column 7, the Counterparty domicile in column 8, the Group domicile in column 9, the Central estimate of reinsurance recoverables in column 10, the Net reinsurance recoverable on paid claims overdue for more than 6 months – central estimate in column 11, the Reinsurance recoverable outstanding from second annual balance date after the event – central estimate in column 12 and the Deferred reinsurance expense in column 13.
Name of counterparty (reinsurer)
The legal name of the counterparty to the reinsurance exposure. Where relevant, use the name of counterparty as stated on the reinsurer identifier list.
Reinsurer identifier
The unique identifier for the counterparty reported in column 1. Where relevant, the reinsurer identifier must be reported as stated on the reinsurer identifier list. If the reinsurer is not on the reinsurer identifier list, report the reinsurer identifier as ‘unassigned’.
Counterparty group name
The name of the group to which the counterparty to the reinsurance exposure belongs. If the counterparty to the reinsurance exposure does not belong to a group, leave this column blank. Where relevant, the counterparty group name must be reported as stated on the reinsurer identifier list. If the counterparty group name is not on the reinsurer identifier list, report the counterparty group name as per these instructions.
APRA counterparty grade
The counterparty grade of 1 to 7 in accordance with Prudential Standard GPS 001 Definitions (GPS 001).
Major form of collateral / guarantee
The type of collateral / guarantee, if applicable, that is support for the reinsurance recoverables in accordance with Prudential Standard GPS 114 Capital Adequacy: Asset Risk Charge (GPS 114). Where there is more than one type of collateral or guarantee provided as support, report the type that has the greatest monetary exposure. Collateral / guarantee types can include (but are not limited to) trusts, letters of credit and financial guarantees.
Amount of collateral / guarantee
The monetary amount of the collateral / guarantee, if applicable, that is support for reinsurance recoverables.
APRA counterparty grade after collateral / guarantee
The counterparty grade of the collateral / guarantee reported of grade 1 to 7 in accordance with GPS 001. If there is more than one type of collateral or guarantee, report the grade for the type that has the greatest monetary exposure.
Counterparty domicile
For a subsidiary, the domicile is where the counterparty is legally incorporated. For a branch, the domicile is where the counterparty (branch) is located. Where relevant, the counterparty domicile must be reported as stated on the reinsurer identifier list. If the counterparty is not on the reinsurer identifier list, report the domicile using the domiciles listed in Appendix 1.
Group domicile
The domicile where the group owning the counterparty is legally incorporated. If the counterparty does not belong to a group, leave this column blank. Where relevant, the group domicile must be reported as stated on the reinsurer identifier list. If the group is not on the reinsurer identifier list, report the group domicile using the domiciles listed in Appendix 1
Central estimate of reinsurance recoverables
The reinsurance recoverables associated with the counterparty reported in column 1. This amount will include the recoverables on incurred but not reported (IBNR) claims that are allocated to the counterparty. This amount must exclude the amounts reported in columns 11 and 12 for that counterparty. It is measured at central estimate level, in accordance with Prudential Standard GPS 320 Actuarial and Related Matters (GPS 320).
Net reinsurance recoverable on paid claims overdue for more than 6 months – central estimate
The reinsurance recoverables on paid claims where:
· the recoverable has become a receivable (i.e. it is due and payable);
· the receivable is overdue for more than six months since a request for payment has been made to the reinsurer; and
· there is no formal dispute between the insurer and the reinsurer in relation to that receivable.
The categorisation is in accordance with GPS 114 and the central estimate level is in accordance with GPS 320.
Reinsurance recoverable outstanding from second annual balance date after the event – central estimate
The reinsurance recoverables that are outstanding on and from the second balance date after the end of the financial year in which the event giving rise to the recoverables occurred regardless of whether the reinsurance recoverables are supported by collateral, guarantee or letter of credit. The amount reported should include IBNR. The categorisation is in accordance with GPS 114 and the central estimate level is in accordance with GPS 320.
Deferred reinsurance expense
The value of premiums ceded to reinsurers which are determined in accordance with GPS 320 and deferred in accordance with the pattern of reinsurance service received as per GPS 320.
Other
This is a derived item for column 6 and columns 10 to 13. Other is equal to the difference between the ‘Total’ reported for each of column 6 and columns 10 to 13 and the reported amounts for each counterparty in aggregate.
Total
This is the total of the relevant amounts for column 6 and columns 10 to 13 and may include amounts that have not been reported in a row within the form.
Glossary of additional terms
Incurred but not reported (IBNR)
Represents the claims arising from incidents occurring prior to the close of the reporting period which are expected to be reported in subsequent reporting periods.
Reinsurer identifier list
This is a list of reinsurers which includes the name of the counterparty, counterparty domicile, counterparty group name and group domicile that must be used for reporting on GRF 460.0 and GRF 460.0_G. The list is located on APRA’s website.
Interpretation
For the purposes of these instructions:
· Appointed Auditor is defined in GPS 001;
· general insurer means a general insurer authorised under the Insurance Act 1973;
· Group Auditor is defined in GPS 001;
· regulated institution is defined in GPS 001 as a collective term for general insurers and Level 2 insurance groups; and
· Level 2 insurance group is defined in Attachment D of GPS 001.
Appendix 1: Country list
The following country list must be used when reporting any values for columns 8 and 9.
If the country cannot be identified, report the relevant ‘residual’ region listed in the table (for example, US Pacific Islands). If the residual region cannot be identified, report ‘unallocated’.
Country/Grouping
Code
Afghanistan
AF
Albania
AL
Algeria
DZ
Andorra
AD
Angola
AO
Argentina
AR
Armenia
AM
Aruba
AW
Australia
AU includes Christmas Islands, Cocos Islands, Norfolk Islands, Heard and McDonald Islands, Territory of Ashmore and Cartier Islands and Territory of Coral Sea Islands
Austria
AT
Azerbaijan
AZ
Bahamas
BS
Bahrain
BH
Bangladesh
BD
Barbados
BB
Belarus
BY
Belgium
BE
Belize
BZ
Benin
BJ
Bermuda
BM
Bhutan
BT
Bolivia
BO
Bosnia and Herzegovina
BA
Botswana
BW
Brazil
BR
British Overseas Territories
1W includes British Antarctic Territory, British Indian Ocean Territory, Chagos, Pitcairn Islands, South Georgia and South Sandwich Islands
Brunei
BN
Bulgaria
BG
Burkina Faso
BF
Burundi
BI
Cambodia
KH
Cameroon
CM
Canada
CA
Cape Verde
CV
Cayman Islands
KY
Central African Republic
CF
Chad
TD
Chile
CL
China
CN
Colombia
CO
Comoros Islands
KM
Congo
CG
Congo Democratic Republic
CD
Consortium Banks
1G
Costa Rica
CR
Cote d'Ivoire
CI
Croatia
HR
Cuba
CU
Cyprus
CY
Czech Republic
CZ
Denmark
DK excludes Faeroe Islands and Greenland
Djibouti
DJ
Dominica
DM
Dominican Republic
DO
Ecuador
EC
Egypt
EG
El Salvador
SV
Equatorial Guinea
GQ
Eritrea
ER
Estonia
EE
Ethiopia
ET
Faeroe Islands
FO
Falkland Islands
FK
Fiji
FJ
Finland
FI includes Aland Islands
France
FR includes French Guiana, French Southern Territories, Guadeloupe, Martinique, Mayotte, Monaco, Reunion and St. Pierre and Miquelon
French Polynesia
PF includes Society Archipelago, Tuamotu-Gambier Islands, Marquesas, Australes Archipelago
Gabon
GA
Gambia
GM
Georgia
GE
Germany
DE
includes the European Central Bank
Ghana
GH
Gibraltar
GI
Greece
GR
Greenland
GL
Grenada
GD
Guatemala
GT
Guernsey
GG
Guinea
GN
Guinea-Bissau
GW
Guyana
GY
Haiti
HT
Honduras
HN
Hong Kong SAR
HK
Hungary
HU
Iceland
IS
India
IN
Indonesia
ID
International organisations
1C except the BIS which is included under Switzerland, and the ECB which is included under Germany
Iran
IR
Iraq
IQ
Ireland
IE
Isle of Man
IM
Israel
IL
Italy
IT
Jamaica
JM
Japan
JP
Jersey
JE
Jordan
JO
Kazakhstan
KZ
Kenya
KE
Kiribati
KIR
Kuwait
KWT
Kyrgyz Republic
KGZ
Laos
LAO
Latvia
LV
Lebanon
LB
Lesotho
LS
Liberia
LR
Libya
LY
Liechtenstein
LI
Lithuania
LT
Luxembourg
LU
Macau SAR
MO
Macedonia
MK
Madagascar
MG
Malawi
MW
Malaysia
MY includes Labuan International Offshore Financial Centre
Maldives
MV
Mali
ML
Malta
MT
Marshall Islands
MH
Mauritania
MR
Mauritius
MU
Mexico
MX
Micronesia
FM
Moldova
MD
Mongolia
MN
Montenegro
ME
Morocco
MA
Mozambique
MZ
Myanmar
MM
Namibia
NA
Nauru
NR
Nepal
NP
Netherlands
NL
Netherlands Antilles
AN includes Bonaire, Curacao, Saba, St. Eustatius and St. Maarten
New Caledonia
NC
New Zealand
NZ includes Cook Islands, Minor Islands, Niue, Ross Dependency and Tokelau
Nicaragua
NI
Niger
NE
Nigeria
NG
North Korea
KP
Norway
NO includes Bouvet Islands, Svalbard and Jan Mayen Islands
Official Monetary Authorities
1D
Oman
OM
Pakistan
PK
Palau
PW
Palestinian Territory
PS
Panama
PA includes Panama Canal Zone
Papua New Guinea
PG
Paraguay
PY
Peru
PE
Philippines
PH
Poland
PL
Portugal
PT includes the Azores and Madeira
Qatar
QA
Residual Africa and Middle East
2W includes Western Sahara
Residual Asia and Pacific
2O
Residual developed countries
2R
Residual Europe
2B
Residual Latin America and Caribbean
2H
Residual offshore centres
2N
Romania
RO
Russia
RU
Rwanda
RW
Samoa
WS
San Marino
SM
Sao Tome and Principe
ST
Saudi Arabia
SA
Senegal
SN
Serbia
RS
Seychelles
SC
Sierra Leone
SL
Singapore
SG
Slovakia
SK
Slovenia
SI
Solomon Islands
SB
Somalia
SO
South Africa
ZA
South Korea
KR
Spain
ES includes Balearic Islands, Canary Islands and Ceuta and Melilla
Sri Lanka
LK
St. Helena
SH includes Ascension, Gough and Tristan Da Cunha
St. Lucia
LC
St. Vincent
VC includes the Grenadines
Sudan
SD
Suriname
SR
Swaziland
SZ
Sweden
SE
Switzerland
CH includes Bank for International Settlements
Syria
SY
Taiwan, China
TW
Tajikistan
TJ
Tanzania
TZ
Thailand
TH
Timor Leste
TL
Togo
TG
Tonga
TO
Trinidad and Tobago
TT
Tunisia
TN
Turkey
TR
Turkmenistan
TM
Turks and Caicos
TC
Tuvalu
TV
Uganda
UG
Ukraine
UA
Unallocated
5M
United Arab Emirates
AE
United Kingdom
GB excludes Guernsey, Isle of Man and Jersey
United States
US includes American Samoa, Guam, Midway Islands, Northern Mariana Islands, Puerto Rico, US Virgin Islands and Wake Islands
Uruguay
UY
US Pacific Islands
PU includes Carolines, Howland and Baker, Kingman Reef, Palmyra and Jarvis and Johnston
Uzbekistan
UZ
Vanuatu
VU
Vatican
VA
Venezuela
VE
Vietnam
VN
Wallis and Futuna
WF
West Indies UK
1Z includes Anguilla, Antigua and Barbuda, British Virgin Islands, Montserrat and St. Christopher/St. Kitts - Nevis
Yemen
YE
Zambia
ZM
Zimbabwe
ZW