Not “enterprise as normal” for trade with IFRS 17 challenges nonetheless forward – WTW

Insurers have highlighted vital challenges remaining after reporting their half-year 2023 outcomes beneath IFRS 17 for the primary time, in accordance with a worldwide survey by WTW.

The research, polling 235 insurers from 37 markets, contains 160 (68%) reporting for the primary time in 2023.

Key insights from IFRS 17 research

The report famous that whereas there was materials progress, contributors state that substantial work continues to be wanted post-implementation. In the meantime, information, availability of expert assets, and methods/know-how are recognized as the first challenges for IFRS 17 manufacturing.

Solely 55% of 2023 reporters felt “very assured” in explaining IFRS 17 easy state of affairs outcomes to senior administration or traders. This confidence drops to 18% and 9% when explaining complicated and excessive eventualities, respectively, whereas over half of 2023 reporters are usually not ready for enterprise planning/P&L projections based mostly on IFRS 17/9.

Almost 70% of 2023 reporters count on an extended working-day timetable (WDT), emphasizing the substantial effort required to make IFRS 17 a routine a part of reporting and deal with vital points. These embrace shortening the WDT, materials system/course of enhancements, and enhancing evaluation and understanding of IFRS 17 outcomes.

General, regardless of the challenges, almost all 2023 survey contributors confirmed that dividend-paying capability stays unaffected by IFRS 17.

The estimated whole value for the worldwide insurance coverage trade to implement the IFRS 17 accounting customary is now within the vary of US$21 billion to US$27 billion, reflecting a major 15% enhance in comparison with the 2022 evaluation. The expected common cumulative program prices for the biggest multinationals at the moment are US$240 million every, and US$30 million every for the remaining insurers.

“With insurers going through hefty prices to implement IFRS 17, future investments should be strategic and focused, delivering fast and tangible advantages. Substantial operational efficiencies additionally should be discovered to maximise the advantages of IFRS 17 and transfer the reporting into enterprise as normal,” WTW world IFRS 17 advisory chief Kamran Foroughi stated.

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