PIN 5.8 PIN 5.8 Transfer of risk by an Insurer to an ISPV
This section applies to all
PIN 5.8.2 PIN 5.8.2
Insurermay not:(a) treat amounts recoverable from an ISPVas:(i) an asset; or(ii) reinsurance for the purposes of calculating its liabilities under contracts of insurance it has effected; or(b) otherwise ascribe a value to such amounts;unless it has first obtained a waiver from the DFSA.
PIN 5.8.2 Guidance
In considering:a. whether to grant such a waiver; andb. the amount which the
DFSAwill allow the Insurerto bring into account for these purposes;
DFSAwill take into account the following factors:c. where the ISPVis an Authorised ISPV, the DFSAwill wish to be satisfied that the ISPVcomplies with PIN Rules 10.1.2 to 10.1.7 The DFSAmay rely on information supplied in connection with the ISPV'sapplication for authorisation. However, if the application for a waiver is made after authorisation has been granted, the DFSAmay request confirmation that there has been no material change to the information originally supplied;d. where the ISPVis not authorised, the DFSAwill expect to receive confirmation that the ISPVis subject to regulation by a Financial Services Regulatorin a jurisdiction acceptable to the DFSA. In addition, it will need details of the debt issuance or other financing mechanism by which the ISPV'sreinsurance liabilities are funded. The DFSAwill also expect to receive information about the ISPV'skey management and control functions, including details of the ISPV'sauditors and arrangements for claims handling, and any material outsourcing agreements. The DFSAwill also need information about the structure of any Groupof which the ISPVis a member;e. no credit will be allowed for a contract of reinsurance with an ISPVunless there is an effective transfer of risk to the ISPV. The DFSAwill require evidence of such transfer.f. the DFSAwill also expect to receive an analysis of the potential for risk to revert to the Insureror any of its associates under realistic adverse scenarios or for liabilities to arise in respect of the risks transferred for which no provision has been made.