Insurance contract - IFRS 17 - Foundation

This course is designed for those who wish to learn about the critical technical differences between the accounting and reporting requirements of existing IFRS 4 (and industry practice) and IFRS 17. It is highly relevant to finance and actuarial team members preparing for the change in insurance contract accounting practice: executive officers, industry controllers, analysts, actuaries, auditors and finance professionals who wish to gain a working knowledge of this large new standard.

IFRS 17 has fundamentally changed the accounting requirements for insurers.

Two years of reporting post-transition have helped deepen the understanding of the specificities of the new measurement models and accounting principles. For many insurers, the initial IFRS 17 reporting challenges have been addressed, although some tactical workarounds are still required. Successful adoptions have been driven by effective use of data and technology, supported by strong collaboration between actuarial and finance teams.

Our IFRS 17 specialists will explain the key areas of risk and critical success factors in an IFRS 17 implementation project. Our course is designed to provide an initial working knowledge of the rules, the construction and presentation of numbers, and the narrative they convey. We will discuss practical examples of successful implementation and key lessons learnt.

By the end of this training, participants will be able to understand:

• the key steps of the IFRS 17 journey, prescribed measurement models, concepts introduced by the standard and applicable transition options;
• why the insurance service revenue concept was introduced and how it affects all aspects of reporting under IFRS 17, including systems and tools, data and end-to-end processes, people and capabilities, organisational set-up;
• the process of best estimate assumptions setting, potential challenges in experience studies run by actuaries;
• the requirements for presentation of financial statements and disclosure;
• the areas of significant impact, including product design, KPIs, budgeting, processing and data storage;
• the modelling and valuation implications, key drivers of profit emergence.

IFRS 17 overview

• Timeline and milestones – IFRS 4 and IFRS 17
• Key features of IFRS 17 compared to IFRS 4
• Scope of IFRS 17

Recognition and measurement models

• Initial recognition – decision tree
• General measurement model
• Premium allocation approach
• Variable fee approach
• Comparison of approaches, practical considerations

CSM (Contractual Service Margin) as new revenue recognition concept

• What and why
• Unit of account and level of aggregation

Insurance service revenue
Presentation under IFRS 17 and IFRS 4

• Transition
• Available options
• Data requirements
• Practical challenges

Illustrative example and case studies (practical)
Transition, key steps in IFRS 17 journey

This training is coordinated by Pavel Kostyuchenko, Partner at Pwc Luxembourg.

Pavel Kostyuchenko is a partner and Fellow of the Institute and Faculty of Actuaries, specialising in actuarial consulting and risk modelling for the financial sector with over 20 years of experience, including 17 years at PwC. He leads PwC Luxembourg's actuarial and risk modelling services practice and previously headed actuarial practices in PwC’s CEE offices in Asia. Pavel advises insurers and reinsurers on reserving, financial reporting, IFRS17, Solvency II, business planning, and acquisitions. He contributes to PwC’s global Actuary of the Future and Actuarial Modernisation initiatives and supports the UK Institute and Faculty of Actuaries on the profession’s future in overseas markets. His expertise includes risk capital frameworks, strategic asset allocation, and ALM, serving clients in insurance, asset management, and the public sector.