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IFRS 17 summary and timeline

A summary of IFRS 17 Insurance Contracts, including information on current proposals and a timeline of past amendments, announcements, exposure drafts and consultations.

Summary

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Practical guidance on this standard is now on our main IFRS 17 Insurance Contracts page, with links to eIFRS, the full text standard, eBooks and other resources.

IFRS 17 applies to issued insurance and reinsurance contracts, reinsurance contracts held and investment contracts with a discretionary participation feature that are issued by an entity that also issues insurance contracts. Contracts may be grouped for accounting purposes.

Issuers of insurance contracts should report them in the statement of financial position at the total of:

  1. the fulfilment cash flows, being current estimates of amounts that the entity expects to collect from premiums and pay out for claims, benefits and expenses, adjusted for the timing and risk of those amounts, and
  2. the contractual service margin, being the expected profit for providing insurance cover

Where a contract is expected to be profitable, the profit is recognised over the term during which insurance coverage is provided; where a contract is expected to be loss-making, the expected loss is recognised in profit or loss immediately.

The amount recognised in the statement of financial position should be remeasured at each reporting date, taking into account current discount rates and estimates of the amount, timing and uncertainty of cash flows.

The change in the carrying amount of insurance contracts is included in profit or loss or disaggregated between an amount presented in profit or loss and an amount presented in other comprehensive income. This is an accounting policy choice.

The premium allocation approach (PAA) is a simplified approach that is available to measure some short-term insurance contracts.

The measurement requirements are modified for reinsurance contracts held and insurance contracts with direct participation features.

The standard also has extensive disclosure requirements.

Current proposals

ED/2019/4 Amendments to IFRS 17 was issued in June 2019. The proposed amendments are designed to address concerns about the standard and implementation challenges and include:

  • deferral of the effective date until 1 January 2022;
  • the introduction of additional scope exclusions;
  • amendments relating to cash flows relating to expected contract renewal, the contractual service margin allocation and onerous insurance contracts issued;
  • simplified presentation of insurance contracts in the statement of financial position;
  • the introduction of additional transition reliefs.

Timeline

Date Update
17 March 2020
IASB decides on new effective date for IFRS 17 of 1 January 2023
26 June 2019 IASB proposes to amend IFRS 17 in ED/2019/4 Amendments to IFRS 17

18 May 2017

IASB issues IFRS 17
Effective for annual periods starting on or after 1 January 2021.