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IASB issues new insurance contracts standard

  • IASB document Image

May 18, 2017

The IASB has published a new standard, IFRS 17, “Insurance Contracts,” which supersedes IFRS 4 and establishes principles for the recognition, measurement, presentation, and disclosure of insurance contracts.

The main objective of IFRS 17 is to reduce the diversity in practice that arose under IFRS 4, which allowed companies “to carry on accounting for insurance contracts using national accounting standards, resulting in a multitude of different approaches.” The new standard increases comparability “by requiring all insurance contracts to be accounted for in a consistent manner, benefiting both investors and insurance companies.”

IFRS 17 is effective for annual reporting periods beginning on or after January 1, 2021. Earlier application is permitted if both IFRS 15, Revenue From Contracts With Customers and IFRS 9, Financial Instruments, have also been applied. The standard should be applied retrospectively unless it is impracticable to do so; entities then have the option to use a modified retrospective approach or the fair value approach.

For more information, see Deloitte’s IFRS in Focus newsletter as well as the following resources on the IASB’s Web site:

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