(1) An insurance undertaking or reinsurance undertaking shall calculate the Minimum Capital Requirement in accordance with the following principles:
(a) it shall be calculated in a clear and simple manner, and in such a way as to ensure that the calculation can be audited;
(b) it shall correspond to an amount of eligible basic own funds below which policy holders and beneficiaries would be exposed to an unacceptable level of risk if the undertaking were allowed to continue its operations;
(c) the linear function referred to in paragraph (3) used to calculate the Minimum Capital Requirement shall be calibrated to the Value-at-Risk of the basic own funds of the undertaking subject to a confidence level of 85% over a one-year period;
(2) The Minimum Capital Requirement shall have an absolute floor of -
(a) €2,700,000 for a non-life insurance undertaking, including a captive insurance undertaking, except in the case where all or some of the risks included in one of classes 10 to 15 in Pa
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