1988 Ed.]
Insurance Companies
[CAP, 41
53
(a) claims in respect of incidents occurring---
(i) in the case of an amount set aside as at the beginning of the financial year, before the beginning of that year; and
(ii) in the case of an amount set aside as at the end of the financial year, before the end of that year,
being claims which have not been treated as claims paid and including claims relating to business accounted for over a longer period than a financial year, claims the amounts of which have not been determined and claims arising out of incidents that have not been notified to the insurer; and
(b) expenses (such as, for example, legal, medical, surveying or engineering costs) which have been incurred but not yet recorded as paid or which are likely to be incurred by the insurer, whether through the employment of its own staff or otherwise, and are directly attributable to the settlement of individual claims which relate to incidents occurring before the beginning or the end of the financial year (as the case may be), whether or not the individual claims in question are those mentioned above;
"claims paid", in relation to general business, means unless otherwise specified the amount that is
paid by an insurer in full or partial settlement of—
(a) claims, including claims relating to business accounted for over a longer period than a
financial year; and
(b) expenses (such as, for example, legal, medical, surveying or engineering costs) which are incurred by the insurer, whether through the employment of its own staff or otherwise, and are directly attributable to the settlement of individual claims, whether or not the individual claims in question are those mentioned above;
"claims paid and outstanding" means the amount obtained by taking the sum of the claims paid during a financial year and the claims outstanding as at the end of that year and deducting therefrom the claims outstanding as at the beginning of the year;
"commission payable", in relation to a financial year of an insurer, means the amounts, whether or not paid during that year, which are recorded during that year as due to intermediaries and cedants in respect of the inception, amendment or renewal of contracts of insurance; "contract of insurance" includes a contract of reinsurance;
"expenses of settling claims" means that part of an insurer's expenses which has been incurred in
respect of general business in the settlement of claims;
"expenses for settling claims outstanding" means the amount set aside by an insurer at the end of its financial year as being an amount likely to be sufficient to meet that part of the insurer's expenses which is likely to be incurred in respect of general business in the settlement of claims in respect of incidents occurring before the end of that year other than expenses which fall to be included under claims outstanding;
"fund", in relation to-
(a) general business recorded as commencing in any financial year of an insurer but accounted for over a period longer than that financial year, means, during such period, an amount not less than the aggregate amount of the premiums receivable during that period (net of reinsurance premiums payable) reduced by the aggregate amount of the claims paid (net of reinsurance recoveries), expenses for settling claims, commission (net of reinsurance commission receivable) and premium taxes in respect of that business and any management expenses attributable to the management of the fund and, after the end of such period, means such amount as is considered necessary to discharge the remaining obligations (net of reinsurance) in respect of that business;
(b) long term business, means the amount standing to the credit of an account maintained in
respect of that business in accordance with section 22 of this Ordinance;
"gross premiums”, in relation to a financial year-
(a) means premiums after deduction of discounts specified in policies or refunds of premiums made in respect of any termination or reduction of risks but before deduction of premiums for reinsurance ceded and of commission payable by the insurer; and
(b) includes premiums receivable by the insurer under reinsurance contracts accepted by the
insurer;
"intermediary" means a person who in the course of any business or profession invites other persons to make offers or proposals or to take other steps with a view to entering into contracts of insurance with an insurer, other than a person who only publishes such invitations on behalf of, or to the order of, some other person;