2016-01-21 | DOF 5423165

Added · Updated

Amending Circular 24/15 of the Single Insurance and Surety Circular

This circular updates Annex 6.6.4-d of the Single Insurance and Surety Circular by modifying the 99.5% percentile values of paid claim indices and proportionality factors for various surety bond types used in retrocession calculations. The revised values apply to fidelity, judicial, administrative, and credit surety bonds to determine the solvency capital requirement. The amendment enters into force the day following its publication in the Official Gazette.

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DOF: 21/01/2016

Amending Circular 24/15 of the Single Insurance and Surety Circular

At the margin, a seal with the National Coat of Arms, which reads: United Mexican States.- Ministry of Finance and Public Credit.- National Insurance and Surety Commission.

AMENDING CIRCULAR 24/15 OF THE SINGLE INSURANCE AND SURETY CIRCULAR

(Annex 6.6.4-d)

The National Insurance and Surety Commission, based on the provisions of articles 366, fraction II, and 372, fraction VI, of the Law of Insurance and Surety Companies, and

CONSIDERING

That in accordance with the provisions of article 233 of the Law of Insurance and Surety Companies, Institutions must calculate monthly the solvency capital requirement in accordance with the general formula referred to in article 236 of said Law, or by using an internal model, in terms of what is established in article 237 of the same legislation.

That according to Provision 6.6.4, fraction II, subsection b), item 2, of the Single Insurance and Surety Circular, in the case of retrocession operations taken from insurance or surety entities abroad, or non-proportional retrocession operations, the 99.5% percentile value of the paid claim index that must be used for the requirement for expected future claims and recovery of guarantees for taken retrocession operations will be that of the market, which is indicated in Annex 6.6.4-d of the aforementioned Single Circular.

That in view of the above, it is necessary to update the 99.5% percentile value of the paid claim index that must be used for the requirement for claims in Annex 66.4-d of the Single Insurance and Surety Circular.

Therefore, the National Insurance and Surety Commission has resolved to amend the Single Insurance and Surety Circular in the following terms:

AMENDING CIRCULAR 24/15 OF THE SINGLE INSURANCE AND SURETY CIRCULAR

(ANNEX 6.6.4-d)

SINGLE PROVISION.

Annex 6.6.4-d of the Single Insurance and Surety Circular is amended.

TRANSITIONAL PROVISION

SINGLE PROVISION.

This Amending Circular shall enter into force the day following its publication in the Official Gazette of the Federation.

The foregoing is made known to you, based on the provisions of articles 366, fraction II, and 372, fraction VI, of the Law of Insurance and Surety Companies.

Respectfully,

Effective Suffrage. No Re-election.

Mexico, D.F., December 30, 2015. - The President of the National Insurance and Surety Commission, Norma Alicia Rosas Rodríguez. - Signature.

ANNEX 6.6.4-d.

MARKET PERCENTILE VALUES OF PAID CLAIM INDICES FOR TAKEN RETROCESSION OPERATIONS

For the purposes of calculating the SCR, in the case of taken retrocession operations, the following values must be used, in accordance with Provision 6.6.4 of the CUSF.

I.

99.5% percentile value of the paid claim index:

Line of business or type of surety bond

Index

First risk fidelity.

100.00%

Other fidelity

7.26%

Judicial covering drivers of motor vehicles

2.34%

Other judicial

3.69%

Administrative

1.05%

Credit

3.25%

II.

Proportionality factors between underwritten secured amounts and premiums

Line of business or type of surety bond

Factor

First risk fidelity.

1.00

Other fidelity

16.34

Judicial covering drivers of motor vehicles

41.80

Other judicial

35.05

Administrative

80.13

Credit

41.80


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