(18)The standard formula calculation of the Solvency Capital Requirement for counterparty default risk requires insurance and reinsurance undertakings to take into account the share of the counterparty's assets that are subject to collateral arrangements. A disproportionate burden in the calculation with the standard formula should be avoided. Insurance and reinsurance undertakings using the standard formula for the calculation of the Solvency Capital Requirement for counterparty default risk should therefore be able to calculate the Solvency Capital Requirement for counterparty default risk on the basis of the assumption that more than 60 % of the counterparty's assets are subject to collateral arrangements.