Unexpired Coverage GMM
In the MCT text, for the Unexpired Coverage for insurance contracts issued, as calculated with the GMM, it is specified that the Premium Cashflows are excluded.
However, for the same formula for the Reinsurance Held, it is not specified that we should exclude them.
Was it intended? I find it a bit hard to believe that since we are subtracting them in the end to get the Net Unexpired Coverage. That feels like we are not comparing to things on the same basis
Also, in the IFRS17 texts, I'm pretty sure we need to include the premiums in the calculation of the LRC. So could we say that LRC is simply ** Unexpired Coverage - APV(Premiums)** ?
Thank you!
Comments
if that is what OSFI says then it is what it is? I have no idea whether the superintendent meant it or not. Your formula unexpired coverage - APV premiums doesn't look like any variation of a PAA or GMM formula to me so I don't think you can say that