Big 4 Panel Discussion: Challenges & Opportunities from IFRS 17

Transcription

1 Big 4 Panel Discussion: Challenges & Opportunities from IFRS 17 Sai-Cheong Foong Co-Chairperson, Life Committee 7 November 2017 The Actuarial Society of Hong Kong

2 Introduction of panel speakers Current status: adoption process, industry timeline, reactions of regulators Key challenges for HK AGENDA Opportunities in modernising business, back office including actuarial function Leveraging support of TRG Implications for actuarial profession Q&A 2

3 Introduction of panel speakers 3

4 Panelists: Mr. Erik Bleekrode, Partner, KPMG Mr. Chris Hancorn, Partner, PwC Mr. Eric Lu, Partner, Deloitte Mr. Doru Pantea, Partner, EY Moderator: Mr. Sai-Cheong Foong, Group Chief Actuary, AIA Group 4

5 Current status 5

6 Current status IFRS 17 Insurance Contracts issued by IASB in May 2017, effective from 1 January 2021 Endorsement Adopted by a few countries so far Australia, Malaysia, Cambodia. Endorsement process in Europe most important globally: assessment of conduciveness to European public good by EFRAG; scrutiny by European Parliament Industry timeline: a number of companies started implementation Reactions of regulators Risk of non-compliant? 6

7 Key challenges for HK 7

8 Key challenges for Hong Kong The new measurement model is a fundamental change, with potentially significant implications from an implementation as well as systems perspective Unique situation Pervasiveness of impact of IFRS 17 not just for listed insurers 159 authorised insurers; 80 are general insurers majority are small-sized Parallel development of HK RBC framework Interaction of solvency regime with IFRS 9 8

9 Opportunities 9

10 Opportunities Optimising products and business performance Modernising back office including actuarial function 10

11 Leveraging support of TRG 11

12 Purpose of TRG The IASB believes that having a discussion forum such as the Transition Resource Group (TRG) to provide support for stakeholders post issuance will enhance the quality and consistency of implementation The TRG for IFRS 17Insurance Contracts is one of the ways the IASB is supporting implementation of the new Standard. The purpose of the group is to*: provide a public forum for stakeholders to follow the discussion of questions raised on implementation inform the IASB in order to help the IASB determine what, if any, action will be needed to address those questions. Possible actions include providing supporting materials such as webinars, case studies and/or referral to the IASB or Interpretation Committee the TRG does not issue guidance * The purpose of the group and further information on the Insurance TRG can be found at go.ifrs.org/ifrs-17-implementation Source: IFRS Foundation 12

13 Insurance TRG procedures and process Source: IFRS Foundation 13

14 How to submit an issue Any stakeholder can submit a potential implementation issue The IASB encourages early submissions Papers submitted after 2 January are less likely to be discussed at the February meeting Issues submitted: must be related to, or arise from, IFRS 17 may result in possible diversity in practice and are expected to be pervasive, i.e. relevant to a wide group of stakeholders Any question submitted should include a detailed description of the possible ways in which IFRS 17 could be applied Submission forms and submitters names will not be public Source: IFRS Foundation 14

15 How to submit an issue Analysis of the question The analysis of the question should include a detailed description of the different ways the new Standard may be applied, resulting in possible diversity in practice Is the question pervasive? Explain whether the question is expected to be relevant to a wide group of stakeholders Source: IFRS Foundation 15

16 Implications for actuarial profession Q&A 16