IFRS17 Insurance Contracts (covering Insurance and Reinsurance) which was published approx. 1 month ago (18th of May) with effective date 1.1.2021. The standard was in preparation for last 10 years and many of us thought, we will retire earlier than it will be published.
IFRS 17 replaces the IFRS 4 Insurance Contracts, and from the market we see serious budget allocations for consulting services within insurance companies for this topic, while this will be biggest change in the accounting for many years.
Big4 already actively selling pre-studies (readiness or health checks analysis) etc. Stay tuned in order to be aligned with my analysis.
While its very beginning, this will require serious research from everyone, even big4 and quick preparation of first pre-sales materials, on the other hand, I see this as big initiative and potential for next 3-4 years.
- IFRS17 Financial reporting standard for insurance
Where is the potential:
- Technology heavy change program (new data requirements on top of Solvency II, change in data collection, storing and processing, while it requires much more granular level of measurement)
- Change in the contract calculation
- IT, Finance, Risk and Actuaries are all key stakeholders
- Expect to bring more volatility in P&L, which will require at the end of the day change of the models for forecasting and simulations
Do not hesitate to contact me in case of any questions or remarks.
Matej (at) Nosicky.com