Glossary

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Term Definition Legal instruments

investment risk

01/01/2016

THIS DEFINITION ONLY APPLIES TO THE INSURANCE COMPANY – RISK MANAGEMENT PART

means the risk that the assets held by a firm

(1) (where they are admissible assets held by the firm to cover its technical provisions) might not be: 

(a) of a value at least equal to the amount of those technical provisions as required by Insurance Company – Technical Provisions 4.1; or

(b) of appropriate safety, yield and marketability as required by Insurance Company – Technical Provisions 6.2(1); or

(c) of an appropriate currency match as required by 3.2;

(2) (where they are held to cover index-linked liabilities) might not be appropriate cover for those liabilities as required by 4.2; and

(3) (where they are held to cover property-linked liabilities) might not be appropriately selected in accordance with the requirements of INSPRU 1.5.36 R of the FCA Handbook and appropriate cover for those liabilities as required by 4.2.