IFRS 17 will provide enhanced reporting across the world: A.M. Best
Source: Middle East Insurance Review | Nov 2018
The new IFRS 17 for insurance contracts aims to bring consistency and compatibility across the world, and likely to provide greater granularity, said a new A.M. Best briefing.
The standard, slated to come into effect on 1 January 2021, leaves insurers with a relatively short period for preparation as they also have to provide comparative figures for 2020. The major reinsurers are in very early stages of adopting IFRS 17 and there have already been calls for a postponement to its implementation date, said the rating agency.
Although IFRS 17 will impose a basic model which is applicable to all jurisdictions for insurers reporting under IFRS, the agency anticipates there will still be some issues of comparability, especially when the standard is first introduced. There are likely to be some areas of interpretation, such as the determination of discount rates, and the criteria on which segmentation of business will be based. With time, those approaches are expected to converge and help comparability.
Companies will have to differentiate clearly between insurance and investment profits, which will provide additional key indicators to measure the performance of long-term business. M