1. Insurance IFRS Seminar December 2, 2016 Bill Horbatt Session 35
Transition Workshop
Insurance IFRS Seminar
December 2, 2016
Bill Horbatt
Session 35

2. First published Balance Sheet at end 2015
Situation
Adopting IFRS in 2018
First published Balance Sheet at end 2015
2010 Portfolio of 10 Year Level Term
Originally followed FAS 60 US GAAP
What choices do we have for transition?

3. Review the spreadsheet
Question # 1
Review the spreadsheet
How was the Risk Adjustment calculated? Is it compliant with the ED?
How does the IFRS net liability compare against the US GAAP net liability at 2015?
Why is the % investment return assumption not the same as the discount rate assumption?

4. Review the profitability
Question # 2
Review the profitability
Why is the profit not a constant % of the claims?
In what ways do you need to change the yellow cells in order to make the profit a constant % of the claims?
How does the Risk Adjustment change the profitability, in terms of both shape and PV?

5. Comment on your choices
Question # 3
Comment on your choices
What elements of the calculations could you influence on transition?
How much would these change the shareholder equity at transition and future profits after transition?

6. Thank You