Definitions for Annual and Quarterly Insurer Reports

Definitions for Annual Insurer Report and Quarterly Insurer Report DRAFT released on 23 November 2022 ENDORSEMENT UNCLASSIFIED

UNCLASSIFIED

1 Definitions for Annual & Quarterly Insurer Reports UNCLASSIFIED Purpose of this document The purpose of this Definitions document is to clearly define the information that insurers are required to provide to the Reserve Bank of New Zealand (the “Reserve Bank”) in the Annual Insurer Report and Quarterly Insurer Report. These returns require certain financial, solvency and statistical information about the insurance and other activities of a licensed New Zealand insurer to be regularly provided in a standardised format. The report templates and Definitions may be updated from time to time. The Reserve Bank’s website has the latest published versions at Resources for insurers - Reserve Bank of New Zealand

• Te Pūtea Matua (rbnz.govt.nz).
  Nothing in this document over-rides the provisions of the Insurance (Prudential Supervision) Act 2010 (“IPSA”) and its Regulations (“IPSR”), or solvency standards issued by the Reserve Bank. Version This is draft version 0.0 of the Definitions dated 23 November 2022. It has been prepared for draft version 0.0 of the Annual Insurer Report. Reserve Bank contact details Statistics Unit Insurance Supervision phone +64 4 471 3799 +64 4 471 3951 email statsunit@rbnz.govt.nz insurance@rbnz.govt.nz

UNCLASSIFIED

2 Definitions for Annual & Quarterly Insurer Reports UNCLASSIFIED Contents 1 General instructions _____________________________________________________________________ 3
1.1 Terminology 3
1.2 Materiality 3
1.3 Revisions 3
2 PART A financial _________________________________________________________________________ 4
2.1 Materiality threshold 4
2.2 Columns 4
2.3 Accounting standards and methods 5
2.4 Insurance revenue 65
2.5 Insurance service expense 6
2.6 Insurance service result 7
2.7 Insurance finance result 8
2.8 Insurance balance sheet items 8
2.9 Outwards reinsurance balance sheet items 98
2.10 Additional disclosures 9
2.11 Investment result 1211
2.12 Other income and expenses 1312
2.13 Total comprehensive income 1413
2.14 Investment assets 1413
2.15 Other assets 1615
2.16 Other liabilities 1716
2.17 Off balance sheet items 1716
2.18 Movement in net assets 1817
3 PART B solvency ______________________________________________________________________ 1918
3.1 Columns 1918
3.2 Materiality threshold 1918
4 PART C statistics _____________________________________________________________________ 2019
4.1 Materiality threshold 2019
4.2 Columns 2019
4.3 Statistics 2019
5 PART D supplementary _____________________________________________________________ 2221
5.1 Materiality threshold 2221
5.2 Columns 2221
5.3 Financial data 2221

UNCLASSIFIED

3 Definitions for Annual & Quarterly Insurer Reports UNCLASSIFIED 1 General instructions Unless otherwise indicated, all definitions in this document apply to both the Annual Insurer Report and Quarterly Insurer Report.
1.1 Terminology
Terms that are defined in IPSA, IPSR, the Interim Solvency Standard 2023 (“ISS”) published by the Reserve Bank, or the New Zealand International Financial Reporting Standards (“NZ IFRS”) have the same definition for the Annual Insurer Report and Quarterly Insurer Report unless otherwise stated in these definitions. If there is any conflict in the meaning of defined terms between these sources, use the first definition according to the following priorities:
1) definitions in this document;
2) definitions in IPSA and IPSR;
3) ISS; and
4) NZ IFRS.
Words in bold face are defined terms.
1.2 Materiality
Materiality thresholds define the minimum level of accuracy that is required in the reporting. If insurers are capable of reporting more accurately then they should do so. Approximate methods must not be used if they result in errors that are larger in absolute size than the specified materiality thresholds. In the Annual Insurer Report and Quarterly Insurer Report materiality thresholds vary according to the type of information:
 financial data (PART A of the returns);  solvency requirements of the Reserve Bank (sheets with names that start with “solvency RBNZ”);  solvency requirements of home jurisdictions (“solvency foreign” sheet);  statistical data (PART C of the returns); and  supplementary financial data (PART D of the returns).
1.3 Revisions
Any error (whether by omission, understatement or overstatement) that is larger in absolute size than the relevant materiality threshold is likely to require resubmission with revised figures. Please contact the Reserve Bank to discuss.

UNCLASSIFIED

4 Definitions for Annual & Quarterly Insurer Reports UNCLASSIFIED 2 PART A financial
2.1 Materiality threshold
The materiality threshold for PART A financial is:
min.($5 million, 5% * max.(revenue measure, balance sheet measure, $0.1 million)) where:
revenue measure is annualised total insurance revenue balance sheet measure is absolute value of total insurance assets/(liabilities)
2.2 Columns
Term Definition
NZ primary insurance Insurance for the benefit of people and organisations based in New Zealand, excluding reinsurance of such business. It includes insurance of inbound visitors and workers where this is provided by a New Zealand licensed insurer. NZ inwards reinsurance Reinsurance of NZ primary insurance where risk is transferred (ceded) by another insurer to the reporting insurer. All NZ insurance NZ primary insurance and NZ inwards reinsurance. All foreign insurance Insurance or inwards reinsurance by New Zealand incorporated insurers that is not NZ primary insurance or NZ inwards reinsurance. It includes both foreign branch insurance business and any other insurance for the benefit of people and organisations not based in New Zealand (excluding inbound visitors and workers). All global insurance All NZ insurance and all foreign insurance. data classes The classes used for reporting in the “financial insurance” and ”statistics insurance” sheets. Currently these are the product classes defined in ISS paragraph 17. unallocated {column} The portion of the total figure that has not been allocated to other columns. This should be zero. entire insurer or NZ branch For New Zealand incorporated insurers (including mutual insurers established in New Zealand) this is the entire insurer, and for overseas insurers this is the New Zealand branch (if it exists). NZ resident issued assets Assets for which the issuer is a person, company or other entity that is ordinarily domiciled or has a principal centre of economic interest in New Zealand. non-resident issued assets Assets for which the issuer is a person, company or other entity that is ordinarily domiciled or has a principal centre of economic interest in a country other than New Zealand.

UNCLASSIFIED

5 Definitions for Annual & Quarterly Insurer Reports UNCLASSIFIED Term Definition actual Figures for the financial year to Report Date. Past Forecast The latest forecast approved by the Board available at the start of the financial year. Current Forecast The latest forecast approved by the Board available at Report Date. financial year +n The financial year that is n years after the financial year that includes Report Date.
2.3 Accounting standards and insurance measurement models
Term Definition
NZ IFRS NZ IFRS as defined by the NZ XRB.
NZ IFRS PBE NZ IFRS for Public Benefit Entities as defined by the NZ XRB. NZ IFRS RDR NZ IFRS with Reduced Disclosure Regime as defined by the NZ XRB. NZ GAAP New Zealand Generally Accepted Accounting Practices as defined by the NZ XRB. Select this from the drop-down if the accounting standards are NZ GAAP but neither NZ IFRS or NZ IAS. NZ IAS New Zealand International Accounting Standards as defined by the NZ XRB. other (accounting standard) Accounting standards that are not NZ IFRS or NZ GAAP. PAA The NZ IFRS 17 measurement model Premium Allocation Approach. GMM The NZ IFRS 17 measurement model General Measurement Model. VFA The NZ IFRS 17 measurement model Variable Fee Approach. mixture Where more than one NZ IFRS 17 measurement model has been used. other (accounting insurance measurement models) Accounting methods for insurance contracts that are not NZ IFRS 17 insurance measurement models.

UNCLASSIFIED

6 Definitions for Annual & Quarterly Insurer Reports UNCLASSIFIED
2.4 Insurance revenue
Term Definition
[PAA] insurance revenue The amount of expected premium receipts allocated to the period, applicable under the premium allocation approach. This is intended to cover similar information as paragraph B126 of NZ IFRS 17. expected insurance service expenses incurred The expected amount (as at the beginning of the period) of insurance service expense to be incurred. This is intended to cover similar information as paragraph B124(a) of NZ IFRS 17. decrease/(increase) in the risk adjustment for non-financial risk Changes in the risk adjustment for non-financial risk. This is intended to cover similar information as paragraph B124(b) of NZ IFRS 17. amount of CSM recognised Amount of Contract Services Margin (“CSM”) recognised in profit or loss in the period. This is intended to cover similar information as paragraph B124(c) of NZ IFRS 17. other amounts including experience adjustments for premium receipts Other amounts e.g., experience adjustments for premium receipts other than those that relate to future service. This is intended to cover similar information as paragraph B124(d) of NZ IFRS 17. amounts related to the recovery of amortisation of insurance acquisition cash flows Revenue related to insurance acquisition cash flows determined by allocating the portion of the premiums that relate to recovering those acquisition cash flows to each reporting period. This is intended to cover similar information as paragraph B125 of NZ IFRS 17.
2.5 Insurance service expense
Term Definition incurred claims for this financial year Incurred claims (excluding investment components) over the reporting period. This is intended to cover similar information as paragraph 103(b)(i) of NZ IFRS 17. other insurance service expenses Other insurance service expenses incurred over the reporting period. This is intended to cover similar information as paragraph 103(b)(i) of NZ IFRS 17.

UNCLASSIFIED

7 Definitions for Annual & Quarterly Insurer Reports UNCLASSIFIED Term Definition [PAA] insurance acquisition cash flow expense Insurance acquisition cash flows recognised as expenses when incurred when applying the premium allocation approach. This is intended to cover similar information as paragraph 59(a) of NZ IFRS 17. amortisation of insurance acquisition cash flows Amortisation of insurance acquisition cash flows. This is intended to cover similar information as paragraphs 103(b)(ii) and B125 of NZ IFRS 17. losses/(reversal of losses) on onerous contracts for future service Changes that relate to future service, i.e., losses (+ve) on onerous groups of contracts and reversals (-ve) of such losses. This is intended to cover similar information as paragraph 103(b)(iv) of NZ IFRS 17. increases/(decreases) to liabilities for incurred claims for past service Changes that relate to past service, i.e., changes in fulfilment cash flows relating to the liability for incurred claims (+ve for an increase to liability and - ve for a reduction to liability). This is intended to cover similar information as paragraph 103(b)(iii) of NZ IFRS 17. impairment of assets for insurance acquisition cash flows Impairment loss of an asset for insurance acquisition cash flows assessed at the end of each reporting period, reported as a positive amount. This is intended to cover similar information as paragraphs 28E and B35D of NZ IFRS 17. (reversal of impairment of assets for insurance acquisition cash flows) Reversal of some of all of an impairment of assets for insurance acquisition cash flows reported as a negative amount. This is intended to cover similar information as paragraph 28F of NZ IFRS 17.
2.6 Insurance service result
Term Definition allocation of outwards reinsurance premiums Allocation of premiums paid in respect of a group of outwards reinsurance contracts, reported as a positive amount. This is intended to cover similar information as paragraph 86 of NZ IFRS 17. (amounts recoverable from reinsurers for incurred claims) Claim amounts recovered from the reinsurer in respect of a group of outwards reinsurance contracts, reported as a negative amount. This is intended to cover similar information as paragraphs 66B and 86 of NZ IFRS 17.

UNCLASSIFIED

8 Definitions for Annual & Quarterly Insurer Reports UNCLASSIFIED
2.7 Insurance finance result
Term Definition insurance finance income/(expenses) for insurance contracts Total insurance finance income (+ve) or expense (-ve) for the period irrespective of the entity’s choice to disaggregate between profit or loss and other comprehensive income within its financial statements. This is intended to cover similar information as paragraphs 87 and 88 of NZ IFRS 17. outwards reinsurance finance income/(expenses) for outwards reinsurance contracts Total outwards reinsurance finance income (+ve) or expense (-ve) for the period irrespective of the entity’s choice to disaggregate between profit or loss and other comprehensive income within its financial statements. This is intended to cover similar information as paragraphs 82, 87, and 88 of NZ IFRS 17.
2.8 Insurance balance sheet items
Term Definition insurance assets/(liabilities) for incurred claims Assets (+ve) or liabilities (-ve) for incurred claims representing claims for insured events that have already occurred, including events that have occurred but for which claims have not been reported and other incurred insurance expenses. In addition it relates to:
 insurance contract services that have already been provided;  any investment components; and  other amounts that are not related to the provision of insurance contract services and that are not in the liability for remaining coverage. This is intended to cover similar information as paragraph 78 and Appendix A of NZ IFRS 17. insurance assets/(liabilities) for remaining coverage Assets (+ve) or liabilities (-ve) for remaining coverage representing claims under existing insurance contracts for insured events that have not yet occurred. In addition it relates to:
 insurance contract services not yet provided;  any investment components; and  other amounts that are not related to the provision of insurance contract services and that have not been transferred to the liability for incurred claims. This is intended to cover similar information paragraph 78 and Appendix A of NZ IFRS 17.

UNCLASSIFIED

9 Definitions for Annual & Quarterly Insurer Reports UNCLASSIFIED Term Definition insurance assets for insurance acquisition cash flows Assets (+ve) for insurance acquisition cash flows. This is intended to cover similar information as paragraph 79 and Appendix A of NZ IFRS 17.
2.9 Outwards reinsurance balance sheet items
Term Definition outwards reinsurance assets/(liabilities) for incurred claims Assets (+ve) or liabilities (-ve) for outwards reinsurance of reinsured claims that have already occurred, including events that have occurred but for which claims have not been reported and other incurred insurance expenses. In addition it relates to:
 insurance contract services that have already been received;  any investment components; and  other amounts that are not related to the receipt of insurance contract services and that are not in the liability for remaining coverage. This is intended to cover similar information as paragraph 78 and Appendix A of NZ IFRS 17. outwards reinsurance assets/(liabilities) for remaining coverage Assets (+ve) or liabilities (-ve) for remaining coverage representing outwards reinsurance of claims under existing reinsurance contracts for insured events that have not yet occurred. In addition it relates to:
 insurance contract services not yet received;  any investment components; and  other amounts that are not related to the receipt of insurance contract services and that are not in the liability for remaining coverage. This is intended to cover similar information as paragraph 78 and Appendix A of NZ IFRS 17.
2.10 Additional disclosures
Term Definition gross written premium Includes insurance and inwards reinsurance, but excludes outwards reinsurance:
For short-term contracts (as defined in the ISS) the total amount of premiums payable for contracts written during the reporting period. For long-term contracts (as defined in the ISS) the total amount of premium payable during the reporting period for contracts in-force.

UNCLASSIFIED

10 Definitions for Annual & Quarterly Insurer Reports UNCLASSIFIED Term Definition unallocated {row} The portion of the total figure that has not been allocated to other rows. This should be zero. other {row} The portion of the total figure that has not been included in other rows. This need not be zero (unlike unallocated). [contracts under modified retrospective approach] Contracts where the modified retrospective approach was applied at transition to NZ IFRS 17. This is intended to cover similar information as paragraph C6 to C19A of NZ IFRS 17. [contracts under fair value approach] Contracts where the fair value approach was applied at transition to NZ IFRS 17. This is intended to cover similar information as paragraph C20 to C24B of NZ IFRS 17. directly attributable initial commission expense For long-term insurance contracts (as defined in the ISS) the cost of commission payable in respect of the first year of cover, whether payable at inception or a later date. other directly attributable acquisition expenses Expenses associated with sales of insurance business, but excluding commission, for example marketing costs and salaries of employed sales staff. other directly attributable commission expenses The cost of commissions, excluding directly attributable initial commission. This includes all commission in respect of short-term insurance contracts (as defined in the ISS). other directly attributable expenses Administration and management expenses associated with insurance business that is not included elsewhere. (outwards reinsurance commission deducted from outwards reinsurance premiums) The portion of outwards reinsurance commission that has been subtracted from outwards reinsurance premiums, as a –ve figure. This excludes all commission that is dependent on claim experience. This is intended to be consistent with paragraph 86 of NZ IFRS 17. (outwards reinsurance commission added to recoveries from reinsurers for incurred claims) The portion of outwards reinsurance commission that has been added to outwards reinsurance recoveries, as a –ve figure. This includes all commission that is dependent on claim experience. This is intended to be consistent with paragraph 86 of NZ IFRS 17. outwards reinsurance recoveries The portion of gross policy expense that is met from outwards reinsurance. Includes reinsurance claims and other payments by reinsurers based mainly on claims experience.

UNCLASSIFIED

11 Definitions for Annual & Quarterly Insurer Reports UNCLASSIFIED Term Definition additional reinsurance recoveries incurred Outward reinsurance recoveries in respect of claims incurred in the period. reinsurance recoveries received Value of outward reinsurance recoveries received in the period. increase/(decrease) in prior period including impairment of reinsurance recoveries Impairments and other changes in the value of outward reinsurance recoveries related to prior periods. insurance assets/(liabilities) present value of future premiums Present value of the future cash inflows minus the present value of the future cash outflows that relate to premiums in respect of future service as at Report Date. insurance assets/(liabilities) present value of future claims (guaranteed excluding time value) Present value of the future cash inflows minus the present value of the future cash outflows that relate to guaranteed benefits in respect of future service as at Report Date, but excluding the time value of options and guarantees. Insurance assets/(liabilities) present value of time value of options & guarantees Present value of the time value of options and guarantees at Report Date, considering the range of possible outcomes. insurance assets/(liabilities) present value of future claims (non-guaranteed) Present value of the future cash inflows minus the present value of the future cash outflows that relate to non-guaranteed benefits (such as undeclared bonuses and other discretionary benefits) in respect of future service as at Report Date. insurance assets/(liabilities) present value of future expenses Present value of the future cash inflows minus the present value of the future cash outflows that relate to expenses in respect of future service as at Report Date. insurance assets/(liabilities) present value of future other cash flows Present value of the future cash inflows minus the present value of the future cash outflows that relate to other cash flows not included in other rows in respect of future service as at Report Date. insurance assets/(liabilities) present value of net cash flow Present value of the future cash inflows minus the present value of the future cash outflows that relate to future service as at Report Date. insurance assets/(liabilities) present value of risk adjustment Present value of risk adjustment for non-financial risk as at Report Date. This is intended to cover similar information as paragraph 37 of NZ IFRS 17.

UNCLASSIFIED

12 Definitions for Annual & Quarterly Insurer Reports UNCLASSIFIED Term Definition insurance assets/(liabilities) present value of contractual services margin Present Value of NZ IFRS 17 Contractual Service Margin (“CSM”) as at Report Date. [Participating] total assets backing participating business Total assets backing the Participating class of life insurance. [Participating] shareholder retained profits for participating business Shareholder retained profits in respect of the Participating class of life insurance. [Participating] implied policyholder share of total assets backing participating business The implied policyholder share of total assets backing the Participating class of life insurance. [Participating] policyholder retained profits As defined in IPSR 29. premium debt Unpaid premiums and premiums yet to be forwarded to the insurer by agents or brokers. Excludes premiums already accounted for as received. policy loans Loans to policyholders that are secured against policy benefits and claims. Excludes loans and mortgages to policyholders that are not associated with insurance policies. deferred tax on insurance contracts The components of deferred tax assets/liabilities related to insurance contract assets or liabilities. This is intended to cover similar information as paragraphs 5 and 81(g)(i) of NZ IAS 12.
2.11 Investment result
Term Definition interest revenue calculated using the effective interest rate method Interest revenue calculated by applying the effective interest rate to the gross carrying amount of a financial asset. This is intended to cover similar information as paragraph 5.4.1 of NZ IFRS 9. other interest and similar income Other interest and similar income that is otherwise not separately included in investment result.

UNCLASSIFIED

13 Definitions for Annual & Quarterly Insurer Reports UNCLASSIFIED Term Definition net realised gains/(losses) on financial assets A realised net gain (+ve) or loss (-ve) on financial assets measured at fair value. This is intended to cover the realised portion of similar information as paragraphs 5.7.1 and 5.7.2 of NZ IFRS 9. net unrealised gains/(losses) on financial assets An unrealised net gain (+ve) or loss (-ve) on financial assets measured at fair value or amortised cost. This is intended to cover the unrealised portion of similar information as paragraphs 5.7.1 and 5.7.2 of NZ IFRS 9. dividend income Income from dividends. This is intended to cover similar information as paragraph 5.7.1A of NZ IFRS 9. rental income Income earned from investment property. This is intended to cover similar information as paragraph 75(f) of NZ IAS 40. net foreign exchange income/(expense) The net amount of exchange differences recognised as an income (+ve) or expense (-ve). This is intended to cover similar information as paragraph 52(a) of NZ IAS 21. (investment management expenses) Expense (-ve) associated with management of investment assets (regardless of whether investments are managed internally or externally).
2.12 Other income and expenses
Term Definition insurance-related income (commissions and fees) Fee & commission revenue that is from insurance-related activity (such as distribution or administration of another insurer's products). Excludes fee & commission revenue from insurance business. asset management services revenue Revenue (+ve) from asset management services. This is intended to cover similar information as paragraphs 113(a) and 114 of NZ IFRS 15. share of profit/(loss) of associates and joint ventures accounted for using the equity method Profit (+ve) or loss (-ve) from associates and joint ventures accounted for using the equity method. This is intended to cover similar information as paragraph 3 of NZ IAS 28. other income Other income (+ve) that is not reported elsewhere. Includes income from contracts outside the scope of NZ IFRS 17. (impairment loss for goodwill) Impairment loss (-ve) i.e., the amount by which the carrying amount of a purchased asset or a cash-generating unit exceeds its recoverable amount.

UNCLASSIFIED

14 Definitions for Annual & Quarterly Insurer Reports UNCLASSIFIED Term Definition This is intended to cover similar information as paragraph 126(a) of NZ IAS 36. (other finance costs) Includes interest expense (-ve) on lease liabilities. This is intended to cover similar information as paragraph 49 of NZ IFRS 16. (other expenses) Other expenses (-ve) that is not reported elsewhere. Includes expenses from contracts outside the scope of NZ IFRS 17.
2.13 Total comprehensive income
Term Definition income tax benefit/(expense) Tax expense (-ve) or benefit (+ve) related to profit or loss from ordinary activities This is intended to cover similar information as paragraph 77 of NZ IAS 12.
2.14 Investment assets
Important note
The definitions of investment assets in PART A financial are intended to be consistent with other surveys of the New Zealand financial system and international reporting (aggregated for all insurers). They are not all identical to definitions in the ISS (and reported in PART B solvency). Term Definition cash & deposits Cash at bank, transferable deposits directly useable for making payments, and fixed term deposits. Amounts are redeemable or withdrawable (with or without penalty) and are usually held with registered banks or other deposit taking institutions. Excludes loans and advances, debt securities and securities purchased under agreement to resell. registered banks All resident financial corporations that are registered under the Banking (Prudential Supervision) Act 1989 or its successors to operate as banks in New Zealand. other deposit taking institutions All deposit taking institutions other than registered banks. It includes non￾bank deposit takers as defined by the Non-bank Deposit Takers Act 2013 or its successors.

UNCLASSIFIED

15 Definitions for Annual & Quarterly Insurer Reports UNCLASSIFIED Term Definition short-term debt securities Negotiable instruments serving as evidence of debt with a residual term to maturity of 1 year or less. Excludes loans and advances, securities purchased under agreement to resell, and derivatives. long-term debt securities Negotiable instruments serving as evidence of debt with a residual term to maturity of greater than 1 year. Excludes loans and advances, securities purchased under agreement to resell, and derivatives. other financial institutions Financial institutions not included in registered banks or other deposit taking institutions. They provide mainly financial services, including financial intermediation, financial risk management, liquidity transformation, and various supporting activities. These include insurers. non-financial businesses Resident business enterprises that produce goods and non-financial services to sell at competitive market prices that are sufficient to generate a profit or surplus in the long term. These units operate in markets where purchasers are free to buy, or not, depending on the price offered, so a sale only occurs when there is a mutually beneficial exchange. The major non-financial business subsectors are corporate businesses (e.g. registered private companies, publically listed companies, and state owned enterprises (SOEs)) and non￾corporate businesses (e.g. sole proprietorships, small partnerships, and unincorporated businesses owned by the household sector). central government Organisational units of central government responsible for functions such as taxation, law and order, defence, and those responsible for advancing the economic and social well-being of the country in other ways. State-owned enterprises (SOEs) are included in non-financial businesses. local government Territorial authorities and regional councils, as well as other non-market units and non-profit institutions they control. They are responsible for functions such as town planning, providing local infrastructure, libraries, museums, and sports grounds. governments and supra-nationals Foreign central governments and inter-governmental agencies. shares listed Equity investments that are listed on an official stock exchange (such as NZX or ASX). shares not listed Equity investments that are not listed on an official stock exchange. Excludes investments in subsidiaries and associates. property and infrastructure trusts A type of retail public (offer) unit trust that issues units to the general public within New Zealand and invest the pooled monies primarily in real property. They must have registered a prospectus. pooled investments Investment products that pool money from investors, and purchases assets on behalf of the investors as a group. Examples include retail trusts and group investment funds, cash management trusts, and wholesale trusts.

UNCLASSIFIED

16 Definitions for Annual & Quarterly Insurer Reports UNCLASSIFIED Term Definition retail trusts and group investment funds Pooled investments where the trust or group investment fund is the legal owner of the investments and issues units to the general public within New Zealand. cash management trusts Pooled investments where the trust generally confines its investments to financial securities with a maturity of less than one year only, and issues units that are redeemable by the unit holder on demand. Include all such trusts, whether open or closed to the general public. wholesale trusts Pooled investments where the trust is the legal owner of the investments and issues units, but only if the trust is not open to the general public. Exclude cash management trusts. derivatives for investment Positive or negative value of derivatives associated with investments. Exclude other derivatives (e.g., hedging of foreign currency liabilities). This is intended to cover similar information as Appendix A of NZ IFRS 9. other financial assets Financial assets that are investments but not included elsewhere. owner-occupied property Land and buildings that is owner-occupied. owned property (not owner-occupied) Land and buildings for the purpose of investment. other non-financial assets Non-financial assets that are investments but not included elsewhere.
2.15 Other assets
Term Definition related party assets
(excluding insurance￾related)
Debt owed to the insurer by a related party, equity investments in related parties, or other assets exposed to related parties. Related party is defined in
section 6 of IPSA. Related party assets must not be offset against related party
liabilities. Excludes assets in relation to insurance business (such as outwards reinsurance to a reinsurer that is a related party), derivatives for investment and derivatives not for investment. loans (excluding related party & policy loans) Debt owed to the insurer that is non-negotiable and not evidenced by the issuance of securities. Includes general debtors. Excludes assets in relation to insurance business (such as policy loans), investment assets (such as debt securities), and related party assets. derivatives not for investment Positive or negative value of derivatives not associated with investments (e.g., hedging of foreign currency liabilities). This is intended to cover similar information as Appendix A of NZ IFRS 9.

UNCLASSIFIED

17 Definitions for Annual & Quarterly Insurer Reports UNCLASSIFIED Term Definition property, plant and equipment (excluding owner-occupied and owned property) Fixed assets that are property-related, but excluding right-of use lease assets. other fixed assets Physical assets that are not investment assets and not property, plant and equipment. goodwill & other intangible assets Goodwill (“an asset representing the future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognised”) and any other intangible assets. This is intended to cover similar information as NZ IFRS 3and NZ IAS 38. tax assets Tax balances owing to the insurer, regardless of whether current or deferred. These must not be netted off against tax liabilities. Exclude any amount included within insurance assets/(liabilities). other assets (n.e.c.) Any other asset not elsewhere classified (e.g. right-of-use lease assets). Excludes assets in relation to insurance business and investment assets.
2.16 Other liabilities
Term Definition related party liabilities (excluding insurance￾related) Debt owed by the insurer to a related party. Related party is defined in section 6 of IPSA. Related party liabilities must not be offset against related party assets. Excludes liabilities in relation to insurance business (such as outwards reinsurance liabilities to a reinsurer that is a related party). tax liabilities Tax balances owed by the insurer, regardless of whether current or deferred. These must not be netted off against tax assets. Exclude any amount included within insurance assets/(liabilities). other liabilities (n.e.c.) Any other liability not elsewhere classified, e.g., lease liabilities. Excludes liabilities in relation to insurance business.
2.17 Off balance sheet items
Term Definition
(declared but unpaid dividends & capital distributions) Future dividends or distributions of capital that have been declared by the board of the insurer at Report Date, but which are not fully reflected in the balance sheet.

UNCLASSIFIED

18 Definitions for Annual & Quarterly Insurer Reports UNCLASSIFIED Term Definition (defined benefit scheme deficit) The deficit in any defined benefit scheme(s) for which the insurer is a sponsoring employer, to the extent this is not fully reflected in the balance sheet as a liability. (contingent liabilities) The total value of any contingent liabilities that are required to be disclosed by the accounting standards, to the extent that it is not already reflected in the balance sheet. For contingencies that are not included at all in the balance sheet the value is the face value or maximum possible liability. For contingencies that are partially included in the balance sheet the value is the difference between maximum possible liability and liability recorded in the balance sheet. Please include in the commentary an explanation of any contingent liabilities for which the maximum possible liability is not quantifiable.
2.18 Movement in net assets
Term Definition capital additions New capital that has been raised during the financial year, other than through total comprehensive income. This includes issue of new share equity, transfer from head office for an overseas insurer, and contributions to members’ funds for a mutual insurer. (dividends and capital distributions) Capital that has been released during the financial year, other than through total comprehensive income. This includes dividends and share buy-backs, transfers to head office for an overseas insurer, and repayment of contributions to members’ funds for a mutual insurer.

UNCLASSIFIED

19 Definitions for Annual & Quarterly Insurer Reports UNCLASSIFIED 3 PART B solvency Important note Most items in PART B solvency are defined in the ISS. Definitions used from the ISS are not repeated in this document. Asset definitions in the ISS are not all identical to definitions in PART A financial.
3.1 Columns
Term Definition entire insurer For New Zealand incorporated insurers (including mutual insurers established in New Zealand) this is the entire insurer, including any statutory funds. 1 st statutory fund or {label entered by insurer} The first statutory fund of a New Zealand incorporated insurer or an overseas insurer that is subject to the Reserve Bank’s solvency requirements. consolidated Entire insurer plus any insurance subsidiaries (whether incorporated in New Zealand or overseas). Refer ISS paragraph 6ii.
3.2 Materiality threshold
The materiality threshold for the sheets with names that start with “solvency RBNZ” is:
assessed by the appointed actuary in accordance with ISS Appendix 3. The materiality threshold for the “solvency foreign” sheet is:
max.($1 million, 10% * home jurisdiction equivalent to adjusted solvency margin).

UNCLASSIFIED

20 Definitions for Annual & Quarterly Insurer Reports UNCLASSIFIED 4 PART C statistics
4.1 Materiality threshold
The materiality threshold for PART C statistics is:
5% * total figure for each type of insurance at Report Date.
4.2 Columns
Term Definition
NZ primary insurance Insurance for the benefit of people and organisations based in New Zealand, excluding reinsurance of such business. It includes insurance of inbound visitors and workers where this is provided by a New Zealand licensed insurer. data classes The classes used for reporting in the “financial insurance” and ”statistics insurance” sheets. Currently these are the product classes defined in ISS paragraph 17. unallocated {column} The portion of the total figure that has not been allocated to other columns. This should be zero.
4.3 Statistics
Term Definition lives insured Number of insured lives. This is not unique lives – some policies may cover multiple classes and some insureds have multiple policies (with one or more insurers). in-force annual premium Annual amount of regularly recurring premiums, excluding single premium written. The premium amount or rate may be fixed or variable on a contractual basis. This differs from premium revenue in financial data due to being a point in time measure (and movement between points in time). single premium written Total of single or ad hoc premiums written during the financial year to Report Date, whether fixed (contractual) or discretionary. sum insured or annual benefit Sum insured (except annual amount of benefit for disability income, group disability income and annuity), gross of outwards reinsurance. Excludes any excess or deductible. new business Movement in statistic during the financial year to Report Date in respect of business that commenced on or after the start of the financial year. For group life and group health new business includes all new schemes and also additions for existing schemes. Excludes adjustments and business that is cancelled from inception. Not applicable to general insurance.

UNCLASSIFIED

21 Definitions for Annual & Quarterly Insurer Reports UNCLASSIFIED Term Definition (lapses, surrenders and cancellations) Movement in statistic (-ve) during the financial year to Report Date in respect of business that terminated early due to policyholder election, whether by non-payment of premiums or active cancellation or surrender. Not applicable to general insurance. (maturities and expiries) Movement in statistic (-ve) during the financial year to Report Date in respect of business that reached the end of their contractual cover due to maturity or expiry. Not required for general insurance. (deaths and disability exits) Movement in statistic (-ve) during the financial year to Report Date in respect of business that ceased cover due to death or disablement of the insured live(s). Not required for general insurance. premium increases not included above Movement in in-force annual premium during the financial year to Report Date that is due to contractual increases or voluntary increases in premium rates and/or cover (e.g. associated with optional changes in cover), or exposure changes. Excludes movement in annual premium due to new business, lapses, surrenders & cancellations, maturities & expiries, deaths & disability exits. If the movement is a decrease record as a negative figure. sum insured or annual benefit increases not included above Movement in sum insured or annual benefit during the financial year to Report Date that is due to contractual increases or voluntary increases in premium rates and/or cover (e.g. associated with optional changes in cover), or exposure changes. Excludes movement in sum insured or annual benefit insured benefit due to new business, lapses, surrenders & cancellations, maturities & expiries, deaths & disability exits. If the movement is a decrease record as a negative figure. adjustments Movement in statistic (increase +ve or decrease –ve) during the financial year to Report Date that is not included elsewhere. This includes transfers of business to or from another insurer, business with an insurer that changes insurance class, correction of errors, etc. Not required for general insurance. growth The net movement in statistic during the financial year to Report Date.

UNCLASSIFIED

22 Definitions for Annual & Quarterly Insurer Reports UNCLASSIFIED 5 PART D supplementary
5.1 Materiality threshold
The materiality threshold for PART D supplementary is:
$1 million.
5.2 Columns
Term Definition
NZ primary insurance Insurance for the benefit of people and organisations based in New Zealand, excluding reinsurance of such business. It includes insurance of inbound visitors and workers where this is provided by a New Zealand licensed insurer. NZ inwards reinsurance Reinsurance of NZ primary insurance where risk is transferred (ceded) by another insurer to the reporting insurer. All NZ insurance NZ primary insurance and NZ inwards reinsurance. data classes The classes used for reporting in the “financial insurance” and ”statistics insurance” sheets. Currently these are the product classes defined in ISS paragraph 17. unallocated {column} The portion of the total figure that has not been allocated to other columns. This should be zero. entire insurer or NZ branch For New Zealand incorporated insurer (including mutual insurers established in New Zealand) this is the entire insurer, and for overseas insurers this is the New Zealand branch (if it exists).
5.3 Financial data
Refer also the definitions for PART A financial.
Term Definition
NZ business excluding
NZ branch
For overseas insurers this is NZ primary insurance or NZ inwards reinsurance that is not conducted in the New Zealand branch. NZ branch For overseas insurers this is NZ primary insurance or NZ inwards reinsurance that is conducted in the New Zealand branch. All NZ business For overseas insurers this is NZ primary insurance or NZ inwards reinsurance, conducted within the New Zealand branch or outside it.