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FSC amends the “Regulations Governing the Preparation of Financial Reports by Insurance Enterprises”

In light of the fact that the assessment of fair value of in-force policy liabilities is now carried out in compliance with IFRS
17, the FSC has re-examined the conditions under which insurers are allowed to measure investment property at fair value subsequent to initial recognition, and on 11 May 2020
amended the aforementioned Regulation. For investment property that meets the compulsory requirement that it can be used immediately with reasonable benefit, fair value must be
assessed by the income approach, using a discount rate no lower than the benchmark interest rate of the aforementioned terms; for investment property that does not meet the
aforementioned requirement, fair value must be assessed by the cost method. Also, subsequent measurement of insurance liabilities must be done using the FSC''s annual “basis of valuation of the fair value of insurance liabilities,” and in the event the fair value of insurance contract liabilities exceeds
the booked amount and the insurer files an improvement plan, if the plan calls for the setting aside of an additional amount to reserves, that amount must be set aside to policy reserves. To
ensure the comparability and consistency of quarterly financial
reports within the same accounting year, the amendment began to apply to the first quarter of 2020 financial report.
Visitor: 527   Update: 2020-06-30