Assets comprising the fourth link in the Lloyd’s chain of security. On 31 December 2002 they amounted to £563m (the central fund of £467m plus other Society assets of £87m). They are the central assets of Lloyd’s less the liabilities of the Society (less the liabilities of the members) valued in accordance with the Lloyd’s Sourcebook (LLD 9-15). For margin of solvency purposes they must cover, in the aggregate: members’ defined deficiencies on general and long-term business, the Society’s required minimum margin and the excess (if any) of €3,000,000 (when converted at a designated rate to sterling) over the sum of members’ margins for long-term business and the amount of any increase in the Society margin invoked under the relevant rule. If net central assets fall below the required amount, the Society must inform the FSA.
Insurance Encyclopedia
Net Claims
Claims after recoveries from Reinsurers (of gross claims incurred).
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Gross claims less reinsurance recoveries.
Net cost
The total premiums paid minus their cash value and any dividends generated by the policy as of the time the difference is being calculated. Insurers who supply life insurance policies usually make comparisons of net cost every ten or 20 years.
Net Direct Premium
Gross premium after returns for policies cancelled or not taken.
Net Earned Premium
The premiums received or due to an insurer less the cost of reinsurance and after adjustment to allow for the cost of any unexpired risk.
Net earned premium (NEP)
This refers to all written premium, including what may not be earned in the reporting period. In some cases, the insurer may decide to reduce their own risk and reinsure the contracts with a reinsurer. In such cases, the reinsurance premium paid out is reduced from the earned premiums received from the policyholder.
Net Earnings
Revenue from operating sources, after deduction of the operating expenses, maintenance, uncollectable revenues, and taxes applicable to operating properties or revenues, but before deduction of financial charges and generally before deduction of financial charges and generally before deduction of provision for depreciation and retirement.
Net Income
In general, synonymous with net earnings, but considered a broader and better term. The balance remaining after deducting from the gross income all operating properties, exception interest or other financial charges on borrowed or other capital.
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The total after-tax earnings generated from operations and realized capital gains as reported in the company’s NAIC annual statement page.
Net Income for Loss Exposure
When any of its property gets lost, damaged or destroyed a business may suffer a reduction in its net income until the property is restored back to its former condition. Thus is because business loses use of that property in whole or in part as a result either (a) revenues are decreased: such as loss of rent, interruption in operation, contingent business interruption, loss of profits on finished goods, reduction in receivables, increase in expenses (b) expenses are increased such as rental value loss, extra expenses.
Net Income Loss
A decrease in revenue or an increase in expenses that occurs because one loses the use of property that is damaged. destroyed or taken.