Question 1 For peak 2 assets it says "Admissible assets backing WP business" Under peak 1 those would be valued at bid/face value. Do you just se the same amount under peak 2 or do you revalue based on market value? Question 2 It says as above less assets backing WOP business in WP fund. Do we include these in peak 1? Why aren't they included in peak 2? Thanks
Assets are valued in the same way for peak 1 and peak 2, ie at their bid value. Most assets have two market values: the bid value that you can sell them for on the exchange and the offer value you can buy them for. You should note that you can only allow for admissible assets on peak 1 and peak 2, but you can allow for any assets above the admissibility limits on peak 2. Peak 1 considers the assets backing both with and without profits business. Peak 2 looks at with-profit liabilities, so only looks at assets backing these. However, if without-profits business is written in the with-profits fund, then the present value of future profits is included as an asset in the peak 2 calculation (so effectively the excess of the assets backing the without-profits business over the realistic value of the liabilities is included as an asset). Best wishes Mark
