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Six months ago, the International Accounting Standards Board (Board) issued IFRS 17 Insurance Contracts. This new IFRS Standard replaces the requirements for accounting for insurance contracts in IFRS 4 Insurance Contracts from 1 January 2021.
Between May and October 2017, members of the Board and technical staff have met more than 300 investors and analysts to explain how IFRS 17 information will differ from information available today.
The initial investor reactions to IFRS 17 were collated by technical staff and shared with the Board at the July 2017 Board meeting. Most investors and analysts we spoke to welcome the improvements in transparency and comparability introduced by IFRS 17. They believe that IFRS 17 will improve financial reporting for insurers, particularly in explaining the source of profits for long-term insurance contracts. The top five questions from investors and analysts include:
1. Will IFRS 17 affect dividend payouts?
2. How can a principle-based Standard like IFRS 17 improve comparability between insurers?
3. Will IFRS 17 bring global comparability to the insurance sector?
4. What are the main differences between IFRS 17, regulatory reporting and embedded value reporting?
5. How will removing insurance premiums from the income statement improve comparability?
- ement
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