IAAHS COLLOQUIUM 2004 Session J IAS and Solvency for Health - - PowerPoint PPT Presentation

IAAHS COLLOQUIUM 2004 Session J IAS and Solvency for Health Insurers

IAS and Solvency for Health Insurers

15.15 Overview: IASB Phase 1&2 / IAA and IAIS Proposals (David Paul) 15.30 Internal Models for Capital Assessment - UK Experience (Rael Davis) 15.55 Solvency & Capital Adequacy for Australian Health Insurers (Gayle Ginnane) 16.20 From statutory to International Accounting – Experiences of a Germany Health Insurer (Kai Spier)

Session J Overview IAAHS COLLOQUIUM 2004

Overview

• Insurance Accounting – IFRS – a global standard for insurance

accounting

• International Association of Insurance Supervisors (IAIS) -

Global Principles

• International Actuarial Association (IAA)
• EU Solvency 1 and 2
• National Case Studies

Insurance Accounting Goes Global

• International Accounting Standards (IAS)
• International Financial Reporting Standards (IFRS)
• Present Situation:
• differences in insurance accounting between

countries

• difficult to compare and understand financial

statements

• EU Stock Exchange listed companies must adopt IFRS

from 1st January 2005

I.F.R.S. Phase 1

• Summer 2003: Controversial Exposure Draft (ED5)
• Spring 2004: IFRS published
• Broad “definition” of insurance contract
• Temporary measure, dispensation from IAS 39
• Locally accepted insurance accounting practice may

continue

• No requirement to disclose “fair value”

I.F.R.S. Phase 2

• Work to re-commence in 2004
• Original fair value proposals, but…..
• To include consideration of other possible

measurement bases

• Unlikely until 2008
• May insurers include in their fair value cash flow for

future renewal premiums – relevant to health insurers?

International Association of Insurance Supervisors (IAIS)

• Insurance core principles and methodology consist of
• esential principles that need to be in place for a

supervisory system to be effective

• explanatory notes that set out the rationale

underlying each principle

• criteria to facilitate comprehensive and consistent

assessments

• benchmark for insurance supervisors in all

jurisdictions.

International Association of Insurance Supervisors (IAIS)

• Principles on Capital Adequacy and Solvency
• Stress testing by insurers Guidance Paper
• The use of actuaries as part of a supervisory model

Guidance Paper

International Actuarial Association (IAA)

• responded to “On Solvency, Solvency Assessments

and Actuarial Issues - An IAIS Issues Paper”

• offered support - IAA Solvency Working Party report
• Risk-based Capital Solvency Structure Working Party

European Union

• Insurance Committee ~ DG MARKT (Internal Market)
• Solvency I
• now organising Pillar I and Pillar II work with CEIOPS
• Solvency II - risk-based approach to target capital -

e.g MARKT/2543/03

• some supervisors in EU member states are already

advancing in style of Solvency II