Technical reserves

Technical reserves are the amounts insurance companies set aside from profits to cover claims. Technical reserves include the unearned premium reserve and the outstanding claims reserve. The latter is the amount of premium written but not earned.

Any reinsurance receivables will be deducted from the technical reserves, as will deferred acquisition costs (the acquisition or marketing costs relating to policies which have not expired by the year end).

Technical reserves may also include the unexpired risk reserve and the claims equalisation reserve if such reserves have been created.