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Insurance Contracts

Date recorded:

Measurement approach for insurance contracts

The Board was encouraged by the staff to narrow still further the candidates for the measurement approach to insurance contracts to the 'modified IAS 37' model only. However, in light of its discussion of the IAS 37 model earlier in the day, the Board was not in a position to make this decision. Instead, the Board requested a more detailed analysis of what the 'modified IAS 37' model might look like, together with a comparison to the current fulfilment model.

 

Unearned premium model

The Board agreed that an unearned premium approach should be the required measurement approach for insurance pre-claims liabilities arising from 'short duration' (such as property and casualty and marine) contracts. This approach was accepted as a simplification.

Other aspects of the unearned premium model would be discussed at a subsequent meeting.