Commentary: Rule 36 Surplus
36.1 General
As explained in the comments under 22.1, premiums charged are calculated as accurately as possible to cover the Member’s obligations insured under these Rules and the Club’s operative costs for the relevant policy year. Should ends not meet, the Club may charge additional calls in accordance with Rule 23.
However, should a surplus arise for a policy year, it may be used to increase the Club’s general reserves, as required by law, requested by the supervisory authorities or decided by the Board.
36.2 Refund of surplus
As and when the situation permits, the Club, through its Board, may decide to refund to the Members a surplus arising in a policy year partly or fully. Such a refund should be distributed to the Members proportionately on the net premiums paid for that policy year. “Net premium” means the premium less commissions, laid-up returns and other deductions, if any.
36.3 Set-off
According to Rule 13, the Club is entitled to set-off unpaid premiums or other amounts due from the Member against the refund of any surplus.
36.4 Who is entitled to a surplus refund?
The Rule states that a surplus refund should be distributed amongst Members. The definition of what constitutes a Member appears in Rule 1. See the comments under 1.4.4.
A Member who has paid a release call under Rule 23 after termination or cesser is not entitled to a surplus for that year. See the comments under 23.8.