IPTM9030 | Overseas insurers: scope of reporting rules: relevant insurances and gross premiums

Relevant insurances

A policy or contract is a relevant insurance if:

• it comes within the scope of the chargeable events legislation

• the policyholder is resident in the UK - see IPTM9040, and

• the policy or contract is not attributable to a UK branch or agency of the insurer (policies and contracts from UK branches and agencies are within the reporting regime for UK insurers).

Gross premiums

Gross premiums are the amounts paid as premiums under the relevant insurances since the policies and contracts were taken out, without any deduction for reinsurance premiums or commissions relating to the same business.

In calculating the amounts of gross premiums paid on policies held by UK residents it is only necessary to consider the residence of the policyholder of each policy or contract on the date that the test is applied. The gross premiums are the premiums that have been paid for the whole period that the policy or contract has run, including for any periods when the policyholder was not UK resident.

Policies denominated in currencies other than sterling

Where a policy or contract is denominated in a currency other than sterling, in calculating the total amount of gross premiums the insurer will need to convert the total amount of premiums paid in each currency into the sterling equivalent. The conversion rate to be used should be the rate that applies on the date that the calculation is made, that is, the date on which the insurer is testing whether its level of business exceeds the £1 million threshold.