Capital required for Unregistered Reinsurers

bkmlocksbkmlocks
in OSFI.MCT

Hi Graham,

I was just wondering which risk factor we should be using when calculating the capital required for unregistered reinsurance in Fall 2020?

The notes says to use 20 % for every risks ceded after Jan 1 2020. Should we assume this on this exam sitting? I guess since until now, I have been using 15 % in literally all questions, it feels a bit weird.

Thank you for your help :)

Comments

  • grahamgraham

    Just to make sure anyone else reading this knows what we're talking about, here is the relevant paragraph from the source text: (It's also mentioned in the web-based practice problems for MCT.)

    So the answer to your question is you have to be given the date the policies were ceded to know whether to use 15% or 20%. It does add an extra wrinkle to the calculation unfortunately, at least until we get to 2023, because then the 20% factor is always used. (All old exam problems for 2019.Fall and prior use 15% of course.)

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