Technical Summary Of Â IFRS 4 Insurance Contracts
(a) limited improvements to accounting by insurers for insurance contracts.
(b) disclosure that identifies and explains the amounts in an insurerâ€™s financial statements arising from insurance contracts and helps users of those financial statements understand the amount, timing and uncertainty of future cash flows from insurance contracts.
An insurance contract is a contract under which one party (the insurer) accepts significant insurance risk from another party (the policyholder) by agreeing to compensate the policyholder if a specified uncertain future event (the insured event) adversely affects the policyholder
(a) prohibits provisions for possible claims under contracts that are not in existence at the reporting date (such as catastrophe and equalisation provisions).
(b) requires a test for the adequacy of recognised insurance liabilities and an impairment test for reinsurance assets.
(c) requires an insurer to keep insurance liabilities in its balance sheet until they are discharged or cancelled, or expire, and to present insurance liabilities without offsetting them against related reinsurance assets.
(a) measuring insurance liabilities on an undiscounted basis.
(b) measuring contractual rights to future investment management fees at an amount that exceeds their fair value as implied by a comparison with current fees charged by other market participants for similar services.
(c) using non-uniform accounting policies for the insurance liabilities of subsidiaries
(a) the amounts in the insurer’s financial statements that arise from insurance contracts.
(b) the amount, timing and uncertainty of future cash flows from insurance contracts.