Deloitte sponsored the Economist Impact to survey 360 insurance executives who are engaged in the implementation of IFRS 17. This research has produced new insights on the collective view of the insurance industry on IFRS 17.
Our key findings are around four major themes:
The industry assessment on the level playing field that could emerge from the adoption of IFRS 17 in over 100 countries from 2023. We report their view on the impact of the decision of the European Union (EU) to offer the option to avoid compliance with a key IFRS 17 requirement for certain material classes of life insurance contracts. This option is only available to insurers based in the EU.
A view on the technology dimension of IFRS 17. All participants acknowledged that this is the most material aspect of their journey. We analyze the scale of the change in systems triggered by IFRS 17. The view on how insurance companies approached the procurement of solutions and their integration in the broader architecture offers a final perspective from a juncture where work was nearly completed.
The preparation of the new financial results under IFRS 17. The theme of managing expectations across internal and external stakeholders brings a wide range of perspectives, both in terms of the state of readiness in June 2022 and elements that would form the investor relations strategy for 2023. During 2023, insurance companies will publish the equivalent of an avalanche of new financial information under IFRS 17. We look at approaches that may be used to manage this.
Post-implementation. Our survey asked about the appetite of insurance executives to embrace the momentum of change triggered by IFRS 17. Are companies using IFRS 17 as a catalyst for continuing a modernization journey for finance and actuarial functions? We look at the perceived benefits - exploring the recent experience as well as the unfulfilled modernization ambitions insurance executives may have for their finance functions.
Additionally, we have published a statistical compendium that shares all of the data from the Economist Impact survey to enable you to go deeper into specific areas of interest.
Under the sponsorship of Deloitte, the Economist Impact surveyed 360 insurance executives during May and June 2022 to gauge the final views of the global insurance industry on IFRS 17. This survey took place only a few months before the "go-live" date of IFRS 17 on 1 January 2023.
This statistical compendium reproduces the questions to the participants and the summary of the answers collected. The findings from this data are the foundation of the four reports that Deloitte has sponsored on this topic.
The IFRS 17 level playing field for insurance reporting–How do insurers plan to make it work?
In this first report of the survey findings, the Economist Impact team has focused on the responses we collected from participants based in the European Union (EU) given the EU-endorsed version of IFRS 17 has a key difference compared with the text originally published by the International Accounting Standards Board. This difference is the addition of a voluntary exemption from one key requirement in IFRS 17 that many stakeholders in the EU endorsement process believed should not apply on a mandatory basis to a particular type of life insurance business commonly found in the EU.
The highlights from the survey are that a large majority of EU-headquartered insurance groups will choose the voluntary adoption of the EU exemption. The overwhelming sentiment indicated that this choice is not expected to significantly dilute the benefit of the level playing field that IFRS 17 could deliver globally. Participants in the survey also noted their plan to provide disclosure on the use of the EU exemption.