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PFN PIN 6.5.17

Item 19, Premium Liability, represents the current portion of the cost of providing insurance service over the unexpired period of General Insurance contracts in force at the balance date. This item must be completed having regard to the following principles:

(a) The Premium Liability reported is required to cover the value of future claims payments and associated direct and indirect settlement costs arising during the unexpired portion of the contracts in question.
(b) Item 19 must be recorded without deducting reinsurance and other recoveries (these are disclosed as an asset as reinsurance receivables); and
(c) The requirements for Recognition and measurement of this liability are set out in section 5.4.
Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]