The Pool's routines in chronological order:
Premiums - collected by each company
When your company starts to write fire insurance in Norway, you must collect the specified natural perils premium cf circulars for actual rate for each insurance covered in Norway. The premium is based on the fire insurance amounts and must be specified as a separate item in the policies.
The money is then kept in the company in a fund and later used as shown under "fund".
Each member company must remember:
Every month by the 5th, all companies must report their losses to the administration. This is done on a particular form.
The administration then will:
All damages are then registered in our computer files and summed up. This gives us a monthly settlement providing information to each company about which of your claims that have been registered.
Each company then receives:
1) a list of the total claims your company has,
2) a separate list over rejected claims.
The monthly settlement part 1 will then give you the figure of your credit/debit balance for this month. This is only for your information as the amounts will be equalised every quarter.
In the administration we will:
Together with the list showing all the reported losses for the quarter in force, each member company will get a letter telling them either
- to pay or
- how much they will get back
The calculations are made according to their distribution formula.
As a company you must:
Remember that all payments are to be transferred directly to the pool's
The distribution formula
Each member's share is based on the company's fire insurance amounts as of 1 July of the claim year. Because it takes some time before the distribution formula is ready, the settlement basis for the year before is used until the distribution formula for the year in force is final.
In practice this means that the formula used in the quarterly settlements each year is the distribution formula as per 1 July the previous year. When the annual settlement is calculated (in January each year), the distribution formula as per 1 July the year before will be used to adjust the amounts that are already paid. In this fashion the claims from the year before will be adjusted with the figure from 1 July of that same year.
First year members:
The first year a company has started to write fire insurance in the pool, the share is based on an average sum of every quarter. The administration will send out a form asking about this information as per 30 March, 30 June, 31 October and 31 December.
In the following years you will receive a questionnaire in which your amount per 1 July must be filled in and reported back to us.
It is important that the reporting is done without any delay, as the distribution formula is the basis for the distribution of the reinsurance.
Translation for the monthly settlement from the Norwegian Natural Perils Pool
1, Norwegian Natural Perils Pool (Norsk Naturskadepool)
2, Monthly settlement part 1 (månedsavregning del 1)
3, Month (måned)
4, Total figures all damages (totalsummer alle skader)
5, Year of damage (skade årg.)
6, Distribution formula ( fordel. nøkkel)
7, Paid (utbetalt hittil)
8, Reinsurance share of the paid amount (Reass del av utbet.)
9, Outstanding losses (gjenst. skaderes.)
10, Reinsurance share of outstanding losses ( reass. del av gj. skader)
11, Company's share of remaining losses (andel av gj skader)
12, Company's share of IBNR (andel av IBNR)
13, Figures for January (summer for måned: Jan "YEAR")
14, Paid in January (utbetalt i måneden)
15, Adjustment compensation (oppgjørs-godtgjørelse)
16, Company's share (selskapets andel)
17, the company's credit/debit (tilgode/skyldig)
18, Total per company (SUM selskap)
The administration's tasks
As per 31 December, the pool's expenses are set up, and adjusted according to the new distribution formula from 1 July this year as described under "distribution formula" .
You will, in January each year, receive the balance for your participation in the previous year.
In May the annual meeting takes place, and the annual account will be presented.
The money taken from each policy is to be kept in a separate fund, see section 3 in the act. The money placed in the fund is to be kept and can later only be used to pay:
* quarterly settlements with the pool
More about the fund, see section 11 in the Pool's Rules.