Prudential Regulation Authority Rulebook

5.1

This Chapter applies to the Society.

5.2

In calculating the MCR for Lloyd’s, in the manner required by 3, the Society must ensure that the MCR is calibrated so as to include all quantifiable risks to which:

1. (1) members are exposed as a consequence of those members carrying on insurance business at Lloyd’s; and
2. (2) the Society is exposed, including risks to the central assets and central liabilities.

5.3

The Society must determine, at least quarterly, the ratio of the Lloyd’s MCR to the Lloyd’s SCR and notify the PRA of the result at the same time it reports the quarterly MCR calculation required by 4.1.

5.4

The Society must calculate a reporting point for each underwriting member, in accordance with 5.5.

5.5

The reporting point for each underwriting member must be calculated using the ratio referred to in 5.3, expressed as a percentage of the member’s notional SCR referred to in Solvency Capital Requirement – General Provisions 8.4.

5.6

The Society must notify the PRA if own funds attributable to a member fall below the reporting point determined in accordance with 5.5 as soon as it is observed by the Society.