1. 1. The standard deviation for non-life premium and reserve risk shall be equal to the following:
\sigma_{\mathrm{nl}} = \frac{1}{V_{\mathrm{nl}}} \cdot \sqrt{\sum_{\mathrm{s,t}} \mathrm{CorrS}_{(\mathrm{s,t})} \cdot \sigma_{\mathrm{s}} \cdot V_{\mathrm{s}} \cdot \sigma_{\mathrm{t}} \cdot V_{\mathrm{t}}}
where:
((a))(a) V_{nl} denotesVnldenotes the volume measure for non-life premium and reserve risk;
((b))(b) the sum covers all possible combinations (s,t) of the segments set out in Annex II;
((c))(c) CorrS_{(s,t)} denotesCorrS(s,t)denotes the correlation parameter for non-life premium and reserve risk for segmentsegmentsand s and segment t setsegmenttset out in Annex IV;
((d))(d) σ_{s} and σ_{t} denoteσsandσtdenote standard deviations for non-life premium and reserve risk of segments s and t respectively;segmentssandtrespectively;
((e))(e) V_{s} and V_{t} denoteVsandVtdenote volume measures for premium and reserve risk of segments s and t,segmentssandt, referred to in Article 116, respectively.
2. 2. For all segments set out in Annex II, the standard deviation for non-life premium and reserve risk of a particular segment s shall be equal to the following:
\sigma_{\mathrm{s}}=\frac{\sqrt{\sigma_{(\mathrm{prem},\mathrm{s})}^{2} \cdot V_{(\mathrm{prem},\mathrm{s})}^{2}+\sigma_{(\mathrm{prem},\mathrm{s})} \cdot V_{(\mathrm{prem},\mathrm{s})} \cdot \sigma_{(\mathrm{res},\mathrm{s})} \cdot V_{(\mathrm{res},\mathrm{s})}+\sigma_{(\mathrm{res},\mathrm{s})}^{2} \cdot V_{(\mathrm{res},\mathrm{s})}^{2}}}{V_{(\mathrm{prem},\mathrm{s})}+V_{(\mathrm{res},\mathrm{s})}}
where:
((a))(a) σ_{(prem,s)} denotesσ(prem,s)denotes the standard deviation for non-life premium risk of segment s determinedsegmentsdetermined in accordance with paragraph 3;
((b))(b) σ_{(res,s)} denotesσ(res,s)denotes the standard deviation for non-life reserve risk of segment s assegmentsas set out in Annex II;
((c))(c) V_{(prem,s)} denotesV(prem,s)denotes the volume measure for premium risk of segment s referredsegmentsreferred to in Article 116;
((d))(d) V_{(res,s)} denotesV(res,s)denotes the volume measure for reserve risk of segment s referredsegmentsreferred to in Article 116.
3. 3. For all segments set out in Annex II, the standard deviation for non-life premium risk of a particular segment shall be equal to the product of the standard deviation for non-life gross premium risk of the segment set out in Annex II and the adjustment factor for non-proportional reinsurance. For segments 1, 4 and 5 set out in Annex II the adjustment factor for non-proportional reinsurance shall be equal to 80 %. For all other segments set out in Annex the adjustment factor for non-proportional reinsurance shall be equal to 100 %.