Page 36 - Insurance Times July 2022

of respective policies. ( 50% in case of other lines - 50% Edelweis General Insurance
appears to be missing)
Reserve for unexpired risk represent that part of net written
premium which is attributable to and allocated to the
Premium deficiency is recognised if the ultimate amount of
succeeding accounting periods. Reserve for unexpired risk
expected net claim costs related expenses and maintenance
is calculated on net written premium on all unexpired
costs exceeds the related premium carried forward to the policies at the balance sheet date based on 1/365th method
subsequent accounting period as the reserve for unexpired
for all segments, other than Health insurance policies with
risks. The Company considers maintenance costs as relevant Health 241 Add ON cover. In Marine Hull business it is subject
direct costs incurred for ensuring claim handling operations.
to a minimum of 100%. In Health insurance policies with
As per IRDAI Circular IRDA/F&A/CIR/FA/126/07/2013, dated Health 241 Add ON cover; the unexpired risk is calculated
3rd July 2013, (corrigendum to master circular IRDA/F&A/
on net written premium on all unexpired policies at the
CIR/FA/231/10/2012 dated 5th October 2012) premium
balance sheet date based on: a) 1/730 basis where there is
deficiency if any has been recognised at segmental Revenue
no claim reported in the 1st year of policy b) 1/365 basis
Account level. The expected claims costs are calculated and where the claim is reported in first year of policy.
duly certified by the appointed actuary.
In accordance with IRDAI Circular IRDA/F&A/CIR/FA/126/07/
The entire amount of reinsurance accepted for the current 2013, dated 3rd July 2013, (corrigendum to master circular
year on account of terrorism pool net of claims and expenses
IRDA/F&A/CIR/FA/231/10/2012 dated 5th October 2012)
upto the above date has been carried forward to subsequent
Premium deficiency is recognised at segment revenue
accounting period as Unexpired Risk Reserve for subsequent
account level when the sum of expected net claim costs
risks, if any to be borne by the company.
related expenses and maintenance costs exceeds the related
premium carried forward to the subsequent accounting
Extent of premium income recognised based on varying risk period as the reserve for unexpired risks. The premium
pattern - Rupees Nil.
deficiency is calculated and duly certified by the appointed
actuary.
Chola MS General Insurance
Premium (Net of Goods and Service Tax) is recognised as Future Generali India Insurance
income on assumption of risk and for installment cases it is
Premium is recognised as income over the contract period
recognised on installment due dates, after adjusting for
or the period of risk whichever is appropriate on gross basis
unexpired risks. net of GST (Goods and Services Tax).
Unexpired Risk Reserves : Direct Business : Reserve for Reserve for unexpired risk in respect of marine hull business
unexpired risks representing that part of the premium is computed at 100% of Net Written Premium during the
written that is attributable and allocable to the subsequent preceding twelve months and other segments it is
accounting periods is calculated principally on day basis in computed on the contract period basis or risk period basis,
terms of IRDA circular No. IRDAI/F&A/CIR/FA/126/07/2013 whichever is appropriate on the unexpired period of
dated July 3, 2013. respective policies.

Inward business from pooling arrangements: In case of Premium deficiency is recognised when the sum of expected
inward premium from terrorism pool (Fire and Engineering net claim costs related expenses and maintenance costs
line of business) Nuclear Pool (Liability line of business) 50% exceeds the related reserve for unexpired risks in accordance
of premium advised by the pool manager for a 12 month with master circular on preparation of financial statements
period is considered as reserve for unexpired risks. of General Insurance Business (IRDAI/F&A/CIR/FA/231/10/
2012 dated 5th October 2012) . The expected claims cost is
Premium deficiency if any is calculated based on actuarial calculated and duly certified by the appointed actuary.
valuation duly certified by the appointed actuary.
GIC Re
In accordance with IRDA Circular No IRDA/F&A/CIR/FA/126/ Reserve for unexpired risk in respect of Marine Insurance
07/2013 dated July 3, 2013, enrollment costs in RSBY schemes (Hull) and Terrorism Risk business (included in Fire and
are absorbed over the policy period. The costs pertaining Engineering) is made at 100% of net premium, while for all
to future accounting periods are shown as reduction from other classes of insurance is made at 50% of net premium
Unexpired Risk Reserves. of the period for which accounts are prepared.

36 The Insurance Times, July 2022