Commentary

D7.421 Reinsurance—general taxation principles

Corporate tax
Corporate tax | Commentary

D7.421 Reinsurance—general taxation principles

Corporate tax | Commentary

Reinsurance

D7.421 Reinsurance—general taxation principles

The rules in this division apply for accounting periods beginning on or after 1 January 2013. For accounting periods beginning before 1 January 2013 see Division D7.5.

Life insurance companies routinely use reinsurance as a way to manage their exposure to risk and to reduce the need for regulatory capital.

Many companies write both direct and reinsured business but a number of companies specialise in writing reinsurance of life insurance business and write no direct business themselves, such companies are often referred to as 'pure' reinsurers.

Reinsurance is only briefly defined in the legislation as including retrocession1 (ie the onwards reinsurance of

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