International GAAP 2013: Generally Accepted Accounting Principles under International Financial Reporting Standards

Chapter 53

Insurance contracts

1 Introduction

1.1 The history of the IASB’s insurance project

1.2 The development of IFRS 4

1.3 Existing accounting practices for insurance contracts

1.3.1 Non-life insurance

1.3.2 Life insurance

1.3.3 Embedded value

2 The objectives and scope of IFRS 4

2.1 The objectives of IFRS 4

2.2 The scope of IFRS 4

2.2.1 Definitions

2.2.2 Transactions within the scope of IFRS 4

2.2.3 Transactions not within the scope of IFRS 4

2.2.3.A Product warranties

2.2.3.B Assets and liabilities arising from employment benefit plans

2.2.3.C Contingent rights and obligations related to non-financial items

2.2.3.D Financial guarantee contracts

2.2.3.E Contingent consideration payable or receivable in a business combination

2.2.3.F Direct insurance contracts in which the entity is the policyholder

2.2.4 The product classification process

3 The definition of an insurance contract

3.1 The definition

3.2 Significant insurance risk

3.2.1 The meaning of ‘significant’

3.2.2 The level at which significant insurance risk is assessed

3.2.2.A Self insurance

3.2.2.B Insurance mutuals

3.2.2.C Intragroup insurance contracts

3.2.3 Significant additional benefits

3.3 Changes in the level of insurance risk

3.4 Uncertain future events

3.5 Payments in kind

3.5.1 Service contracts

3.6 The distinction between insurance risk and financial risk

3.7 Adverse effect on the policyholder

3.7.1 Lapse, persistency and expense risk

3.7.2 Insurance of non-insurance risks

3.8 Accounting differences between ...