GIM7100 - Equalisation reserves: classes other than credit business: summary of requirements

Take each business group

• calculate transfers in
• calculate transfers out - applying the maximum reserve cap.

Then

• combine the reserves to form the aggregate equalisation reserve
• calculate and apply aggregate maximum reserve.

GIM7040 contains a summary of the percentages to be applied in calculating transfers in, transfers out and maximum reserve levels.

GIM7110 contains a complete worked example of an equalisation reserve for an insurer writing insurance falling into two business groups.