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Educational Note: IFRS 17 Risk Adjustment for Non-Financial Risk for Life and Health Insurance Contracts

Publication date: 30-06-2022

Version: Archived

Language available: Bilingual

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The Committee on Life Insurance Financial Reporting (CLIFR) has prepared this educational note to summarize some of the methods available to calculate the risk adjustment for non-financial risk and its corresponding confidence level, in accordance with IFRS 17 requirements.

The educational note is structured into seven sections. Section 1 introduces the content presented in this report. Section 2 highlights the key similarities and differences between IFRS 4 and IFRS 17 with regards to adjustments for uncertainty in estimates of future cash flows. Section 3 presents general considerations related to the measurement and disclosure of the risk adjustment. Sections 4 through 6 present different methods for measurement of the risk adjustment: risk margins in Section 4, cost of capital in Section 5, and quantile techniques in Section 6. Section 7 concludes the note with considerations for the calculation of the confidence level associated with the risk adjustment.

This document replaced document 219081. This document was replaced by document 224118. This document was archived November 12, 2024.

Categories: Practice

Types: Educational notes

Topics: Life insurance

Pages: 36

Format: PDF

Accession no.: 222090

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IFRS 17 Risk Adjustment for Non-Financial Risk for Life and Health Insurance Contracts

14-11-2024