Equalisation reserves on a European basis

Document description

This paper reports on the systems of claims equalisation, both statutory and voluntary in most of the European Community and Scandinavian countries. Case studies of the systems in Finland, Germany and Denmark are presented. The attitude of the industry bodies and the Inland Revenue in the UK are discussed. Appendices discuss technical formulae for determining transfers to or from equalisation reserves and the upper and lower limits for such reserves. The paper also discusses: taxation treatment, whether these reserves can be included in solvency calculations, and whether they are owned by policyholders or shareholders. The paper is in the form of an incomplete draft with some topics, particularly those relating to the use of actuaries, identified but not discussed.