Prudential Regulation Authority Rulebook

1.1

Unless otherwise stated, this Part applies to a non-directive insurer which carries on long-term insurance business, other than a non-directive friendly society.

1.2

Except for 16.3(1) this Part does not apply to final bonuses.

1.3

In this Part, the following definitions shall apply:

benefits payable

means benefits payable under a long-term insurance contract, including:

1. (1) all guaranteed benefits including guaranteed surrender values and paid-up values;
2. (2) vested, declared and allotted bonuses to which the policyholder is entitled;
3. (3) all options available to the policyholder under the terms of the contract; and
4. (4) discretionary benefits payable in accordance with any relevant provisions of the FCA Handbook.

dividend yield

has the meaning given in 9.6(1).

earnings yield

has the meaning given in 9.6(2).

future premium

means the value attributed to a premium due in any future financial year.

internal rate of return

has the meaning given in 9.7.

non-attributable expenses

means expenses which are not directly attributable to a particular contract of long-term insurance.

recoverable acquisition expenses

means the amount of expenses, after allowing for the effects of taxation, which it is reasonable to expect will be recovered from future premiums payable under the contract.

risk-adjusted yield

means the risk-adjusted yield calculated in accordance with 9 and 10.

running yield

has the meaning given in 9.5.