4.4 Legal risk - Scor

G
GOODWILL
Goodwill comprises the residual difference between the identifiable assets of an acquired entity and the purchase price
paid in a business combination. Goodwill is recognized as an asset in the balance sheet, and represents future
economic benefits expected to be generated from assets that are not capable of being individually identified and
separately recognized. Goodwill is tested for impairment on a yearly basis.
GUARANTEED MINIMUM DEATH BENEFIT (GMBD)
The GMDB guarantees investors in a variable annuity that if the owner passes away while the market value is down,
they would never get back less than their original principal.
GROSS WRITTEN PREMIUMS
Actual and estimated premiums to be received for the period from the ceding companies. Gross premiums represent the
turnover for the accounting period.
GROUP POLICY
A single insurance policy that provides insurance coverage for several persons forming a homogeneous group, and
generally belonging to the same company or association, against certain risks such as death, accident, sickness.
I
INSURANCE LINKED SECURITIES (ILS)
Financial instruments whose values are driven by insurance loss events. Those such instruments that are linked to
property losses due to natural catastrophes represent a unique asset class, whose return is uncorrelated with that of the
general financial market.
IMPAIRMENT EXPENSE
The write down which is recorded when the current fair value of the asset is less than its accounted book value.
INCURRED BUT NOT REPORTED (IBNR)
Provision for claims which have already occurred but have not yet been reported to the insurer at the balance sheet
date.
L
LIABILITY ADEQUACY TEST (LAT)
An assessment of whether the carrying amount of an insurance liability needs to be increased (or the carrying amount
of related deferred acquisition costs or related intangible assets, such as VOBA, decreased), based on a review of
future cash flows.
LIFE AND HEALTH REINSURANCE
Collective term for the lines of business in connection with the insurance of persons, i.e. life, pension, health critical
illness, long-term care and personal accident insurance.
LIQUIDATION BONUS
Profit earned on liquidation of technical reserves on settlement of a claim or expiration of a Treaty.
LOSS
Event that triggers insurance cover and reserves recognition.
LOSS ADJUSTMENT EXPENSE
Amount relating to actual or estimated claims expenses declared or not declared that occurred in the accounting year.
LOW OR WORKING LAYER EXCESS OF LOSS REINSURANCE
Reinsurance that absorbs the losses immediately above the reinsured’s retention layer. A low layer excess of loss
reinsurer will pay up to a certain monetary amount at which point a higher layer reinsurer or the ceding company will be
liable for additional losses. Also known as working layer reinsurance.
393