{
  "url": "https://openlegislation.uk/eu-regulation-2015-35/annex-XVII/division-F2/division-2",
  "json_url": "https://openlegislation.uk/eu-regulation-2015-35/annex-XVII/division-F2/division-2.json",
  "legislation": "eur/2015/35",
  "legislation_title": "Commission Delegated Regulation (EU) 2015/35 of 10 October 2014 supplementing Directive 2009/138/EC of the European Parliament and of the Council on the taking-up and pursuit of the business of Insurance and Reinsurance (Solvency II) (Text with EEA relevance) (revoked)",
  "legislation_url": "https://openlegislation.uk/eu-regulation-2015-35",
  "path": "annex/XVII/division/F2/division/2",
  "kind": "division",
  "number": null,
  "heading": "Method specification",
  "text": "(1)For the purpose of paragraphs 4-7, the following notation shall apply:\n(a) n denotes the number of financial years for which aggregated annual losses data is available;\n(b) Y i denotes the aggregated losses in financial year i ;\n(c)μ and ω denote the first and second moment, respectively, of the aggregated annual losses distribution, being equal to the following amounts:\nμ=1n∑i=1nYi\nand\nω=1n∑i=1nY2i\n(d) b 1 denotes the amount of the retention of the recognisable stop loss reinsurance contract referred to in Article 218(2);\n(e)where the recognisable stop loss reinsurance contract referred to in Article 218(2) provides compensation only up to a specified limit, b 2 denotes the amount of that limit.\n(2)The undertaking-specific specific adjustment factor for non-proportional reinsurance shall be equal to the following:\nNP USP = c · NP′ + (1 – c ) · NP\nwhere:\n(a) c denotes the credibility factor set out in section G;\n(b) NP′ denotes the estimated adjustment factor for non-proportional reinsurance set out in paragraph 5;\n(c) NP denotes the adjustment factor for non-proportional reinsurance set out in Article 117(2).\n(3)The estimated adjustment factor for non-proportional reinsurance shall be equal to the following:\nwhere the parameters μ 1 , μ 2 , ω 1 and ω 2 are set out in paragraph 6.\n(4)The parameters μ 1 , μ 2 , ω 1 and ω 2 shall be equal to the following:\nμ1=μ×Nlnb1−θη−η+b1×N−lnb1−θη\nμ2=μ×Nlnb2−θη−η+b2×N−lnb2−θη\nω1=ω×Nlnb1−θη−2×η+b21×N−lnb1−θη\nω2=ω×Nlnb2−θη−2×η+b22×N−lnb2−θη\nwhere:\n(a) N denotes the cumulative probability function of the normal distribution;\n(b) ln denotes the natural logarithm;\n(c)the parameters θ and η are equal to the following:\nθ=2ln μ−12 ln ω\nη=ln ω−2ln μ\n(5)Notwithstanding paragraph 5, where non-proportional reinsurance covers homogeneous risk-groups within a segment, the estimated adjustment factor for non-proportional reinsurance shall be equal to the following:\nNP′=∑hVprem,h×NP′h∑hVprem,h\nwhere:\n(a) V ( prem,h ) denotes the volume measure for premium risk of the homogeneous risk group h determined in accordance with paragraph 3 of Article 116;\n(b) NP′ ( h ) denotes the estimated adjustment factor for non-proportional reinsurance of homogeneous risk group h determined in accordance with paragraph 5.",
  "extent": "E+W+S+N.I.",
  "status": "repealed",
  "version": "current",
  "annotations": [
    {
      "type": "F",
      "label": "F1",
      "text": "Regulation revoked (30.6.2024 for the revocation of Arts. 52-54; 31.12.2024 in so far as not already in force) by Financial Services and Markets Act 2023 (c. 29), s. 86(3), Sch. 1 Pt. 3 (with s. 1(4)); S.I. 2023/1382, reg. 5(c)(i); S.I. 2024/620, Sch. (with savings in relation to a Gibraltar group or a Gibraltar undertaking in S.I. 2024/1083, reg. 3)"
    }
  ],
  "outstanding_effects": [],
  "provenance": {
    "source": "legislation.gov.uk",
    "source_url": "https://www.legislation.gov.uk/eur/2015/35/annex/XVII/division/F2/division/2",
    "retrieved_at": "2026-11-01T14:46:57.886232+00:00"
  },
  "licence": "Open Government Licence v3.0",
  "licence_url": "https://www.nationalarchives.gov.uk/doc/open-government-licence/version/3/",
  "attribution": "Contains public sector information licensed under the Open Government Licence v3.0. Source: legislation.gov.uk, The National Archives."
}