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The Implication of Fair Value Accounting for General Insurance Companies

Published online by Cambridge University Press:  10 June 2011

P. K. Clark ,
P. H. Hinton ,
E. J. Nicholson ,
L. Storey ,
G. G. Wells  and
M. G. White
M. G. White
Affiliation:
Equitas Management Services Ltd., 33 St Mary Axe, London EC3A 8LL, U.K., Tel: +44(0)20-7342-2883, Email:[email protected]
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Abstract

The International Accounting Standards Board is undertaking a project to develop an Accounting Standard for Insurance. The basis for these proposals is that assets and liabilities should be shown at fair values (market values for quoted instruments). This is an updated version of a paper, prepared by a Working Party established by the General Insurance Research Organisation (GIRO) of the General Insurance Board of the actuarial profession of the United Kingdom, which was first presented to the GIRO Conference in October 2002. This paper summarises and comments upon the principal features of the proposals as they have emerged up to February 2003. The paper considers the implications for general insurance companies of these proposals. In particular, it examines the concept of market value margins, and the practical issues that insurance companies are likely to encounter in implementing them. The emphasis of the paper is on reporting for general insurance business, although many of the principles apply equally to life assurance.

Keywords

Fair ValueEntity SpecificFinancial ReportingInternational Accounting StandardsMarket Value MarginsNon-Life Insurance
Type
Sessional meetings: papers and abstracts of discussions
Information
British Actuarial Journal , Volume 9 , Issue 5 , 01 December 2003 , pp. 1007 - 1044
Copyright
Copyright © Institute and Faculty of Actuaries 2003

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References

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