Entire Section

  • PIN A7.3 PIN A7.3 Base fund capital

    • PIN A7.3.1

      The commencement point for calculating the adjusted fund equity in respect of a Long-Term Insurance Fund maintained by an Insurer is the base fund capital.


      Derived from DFSA RM06/2004 (Made 16th September 2004). [VER1/09-04]

    • PIN A7.3.2

      Subject to Rules PIN A7.3.3, PIN A7.3.4 and PIN A7.3.5, the base fund capital in respect of a Long-Term Insurance Fund must consist of the following capital instruments and equity reserves of the Insurer, that are classified as capital instruments and equity reserves of the fund:

      (a) general reserves;
      (b) retained earnings;
      (c) amounts attributed to the Long-Term Insurance Fund by the Insurer in accordance with PIN Rule 3.4.2;
      (d) in the case of a Takaful Insurer, amounts provided from the Owners' Equity by loan to the Insurance Fund and not repaid as at the Solvency Reference Date;
      (e) current year's earnings after tax; and
      (f) hybrid capital (as defined in PIN Rule A7.5.1).

      Derived from DFSA RM06/2004 (Made 16th September 2004). [VER1/09-04]

    • PIN A7.3.3

      Where an Insurer is not a DIFC Incorporated Insurer, base capital may include capital instruments and equity reserves that are approved in writing by the DFSA as equivalent to the capital instruments and equity reserves described in PIN Rule A7.3.2.


      Derived from DFSA RM06/2004 (Made 16th September 2004). [VER1/09-04]

    • PIN A7.3.4

      Owners' Equity in a Takaful Insurer, that has not been transferred to the Insurance Fund, must be classified as hybrid capital for the purposes of this section if:

      (a) under the constitutional documents of the Insurer or the terms of insurance contracts or both, the owners do not participate in the surpluses and losses of Insurance Business; and
      (b) the Owners' Equity is available for loan to the Insurance Fund maintained within the Long-Term Insurance Fund of the Insurer.

      Derived from DFSA RM06/2004 (Made 16th September 2004). [VER1/09-04]

    • PIN A7.3.5

      Hybrid capital having a term to maturity of less than five years may only be included in base fund capital with the written consent of the DFSA.


      Derived from DFSA RM06/2004 (Made 16th September 2004). [VER1/09-04]