FIFTH SCHEDULE
S 467/2002, wef 01/10/2002
Regulations 4, 5 and 6 (1)
S 31/2004, wef 21 Jan 2004
RETURNS ON ACTUARIAL INVESTIGATIONS OF LIFE BUSINESS AND DETERMINATION OF SOLVENCY MARGIN
(FORMS 13, 13A, 14 AND 15)
PART I
MATTERS TO BE STATED IN ABSTRACT OF ACTUARY'S REPORT
S 588/2002, wef 21/11/2002
The following information shall be given, the answers being numbered to accord with the numbers of corresponding paragraphs of this Schedule. Any change from the prior year shall be disclosed.
1. The date to which the investigation relates.
2. The general principles and full details of the methods adopted in the valuation of each of the various descriptions of policy shown in Form 13 in this Schedule, including statements on the following matters:
(a) whether the principles were determined by the instruments constituting or regulating the insurer or, if not, how the principles were determined;
(b) the method of arriving as regards premiums at the amounts for which credit is taken in the valuation, and how the ages at entry, premium terms and maturity dates, have been treated for the purpose of the valuation;
(c) the methods by which the valuation age, period from the valuation date to the maturity date, and the future premium terms have been treated for the purpose of the valuation;
(d) the rate of bonus taken into account whether, by the method of valuation, definite provision is made for the maintenance of a specific rate of bonus;
(e) the method of allowing for -
(i) the incidence of the premium income; and
(ii) premiums payable otherwise than annually;
(f) the methods by which provision has been made for the following matters:
(i) the immediate payment of claims;
(ii) future expenses and bonuses in the case of limited payment policies and paid-up policies;
(iii) liabilities which exist or may arise in respect of lapsed policies not included in the valuation; and
(iv) payment of benefits or waiver of premiums during disability -
(A) in operation at the valuation date; and
(B) not in operation at that date,
and whether any reserves have been made for those matters;
(g) whether under the valuation method adopted any policy would be treated as an asset, and what steps have been taken to eliminate any such asset from the valuation;
(h) a statement of the manner in which policies on under-average lives and policies subject to premiums which include a charge for climatic, military or other extra risks have been dealt with;
(i) the financial impact of any change in the above methods or assumptions.
3. The tables of mortality used, and the rate of interest assumed, in the valuation; and where any table of mortality used is not a published table, specimen policy values (at the rate of interest assumed in the valuation) -
(a) for whole life insurances effected at each of the ages 20, 30, 40 and 50, and having been in force for 5 years, 10 years and upwards at intervals of 10 years; and
(b) for endowment insurances effected at each of the ages 20, 30 and 40 for endowment terms of 20 years and 30 years,
and in the case of policies involving continuous disability benefits, specimens of the valuation factors.
(Note: Where any of thes pecimen policy values or valuation factors have already been given in an abstract lodged with the Authority under the Act, they may be given by reference to that abstract).
4. What proportion of the annual amount of premiums is reserved as a provision for future expenses and bonuses (the proportion to be separately specified in respect of insurances with immediate profits, with deferred profits, without profits and investment-linked).
5. The average rate of interest earned by the fund for each of the 3 years preceding the valuation date.
(Notes:(1) The average rate is to be calculated by dividing the interest of the year by the mean fund of the year; and for this purpose "interest of the year" means the interest, dividends and rents credited during the year, less rates and taxes but including any refund made during the year of rates and taxes; "mean fund of the year" means half the amount obtained by adding the opening balances and the closing balances and deducting the interest of the year; "credited" means credited in the revenue account of the relevant business or part of the business; and "balances" means the balances of that account and of any reserve account in respect of that business or part.
(2) The proportion (if any) of the mean fund which is attributable to reversionary investments not yielding income shall be stated.
6. -(1) The basis adopted in the allocation of surplus as between bonuses on policies and other matters, and whether that basis was determined by the instruments constituting or regulating the insurer or, if not, how the basis was determined.
(2) The general principles adopted in the allocation of surplus among policy owners, including statements on the following matters:
(a) whether the principles were determined by the instruments constituting or regulating the insurer or, if not, how the principles were determined;
(b) the number of years' premiums to be paid, period to elapse, and other conditions to be fulfilled, before a bonus is allocated;
(c) whether the bonus is allocated in respect of each year's premiums paid, or in respect of each completed calendar year or year of insurance or, if not, how the bonus is allocated; and
(d) whether the bonus vests immediately on allocation or, if not, the conditions of vesting.
(3) The total amount of surplus arising since the preceding valuation, including surplus paid away and sums transferred to reserve funds or other accounts since then, and including the amount brought forward from the preceding valuation (to be stated separately); and the allocation of that surplus -
(a) to interim bonus paid;
(b) among policy owners with immediate participation, giving the number of the policies which participated and the sums insured under the policies (excluding bonuses);
(c) among policy owners with deferred participation, giving the number of the policies which participated and the sums insured under the policies (excluding bonuses);
(d) among shareholders or to shareholders' accounts (sums passed through the accounts since the preceding valuation being separately stated);
(e) to every reserve fund, or other fund or account not covered above (sums passed through the accounts since the preceding valuation being separately stated); and
(f) as carried forward unappropriated.
(Note: "The preceding valuation" means the preceding valuation under the Act, if there has been one .If there has been no preceding valuation under the Act or otherwise, the commencement of the relevant business or part of the business is to be substituted for the preceding valuation)
PART II
