IFRS 17 Measurement Models and Insurer Performance Reporting Training

Programme Summary

IFRS 17 measurement models and insurer performance reporting is a five-day training course for insurance finance and actuarial leaders at strategic level, culminating in an IFRS 17 reporting and judgement review for their own organisation. The standard changed how insurers measure contracts and recognise profit, and many boards still struggle to challenge the judgements behind the numbers. The approach links the measurement models to the income statement, disclosures and indicators. Mars Training Centre UK delivers this programme in IFRS 17 measurement and insurer performance reporting.

The Business Case

Under IFRS 17, small changes in discount rates, risk adjustment confidence levels or coverage units move reported profit and equity. Leaders who control these judgements and can explain the contractual service margin and finance result give investors and auditors a coherent story and avoid restatements.

• Quality of Reported Earnings: Improves as margin release and loss components are governed.
• Audit and Close Efficiency: Rises as judgements, models and data are documented and reconciled.
• Investor and Board Confidence: Strengthens as results are presented with clear analysis of movement.

Principles and Evidence Base

• IFRS 17 Insurance Contracts General Measurement Model: Frames fulfilment cash flows, discounting, risk adjustment and the contractual service margin in Sessions 1 and 2.
• IFRS 17 Premium Allocation Approach and Variable Fee Approach: Provide the simplified and direct participating models compared in Session 3.
• IFRS 9 Financial Instruments: Shapes the matching of asset and liability accounting examined in Session 4.

Intended Participants

• Leaders accountable for the financial statements of an insurer or reinsurer.
• Executives who sign off actuarial assumptions, discount rates and risk adjustment methods.
• Heads of function who own IFRS 17 data, models and the financial close.
• Board and audit committee members who challenge insurance accounting judgements.

The programme serves life and savings insurers, general and health insurers, reinsurers and takaful operators, and the audit teams that serve them.

Learning Outcomes

1. Participants will be able to evaluate the scope and aggregation decisions that define IFRS 17 groups of contracts.
2. Participants will be able to analyse the contractual service margin, risk adjustment and loss component.
3. Participants will be able to justify the choice between the premium allocation approach, the variable fee approach and the general model.
4. Participants will be able to diagnose mismatches between reinsurance held, contracts issued and IFRS 9 assets.
5. Participants will be able to interpret insurance revenue, insurance service result and finance result for board reporting.
6. Participants will be able to construct an IFRS 17 reporting and judgement review for their organisation.

Programme Structure

Day 1: IFRS 17 Scope, Aggregation and Measurement Principles

Which contracts fall within IFRS 17, and how are they grouped for measurement?

• Definition of Insurance Contract and Significant Insurance Risk
• Separation of Embedded Derivatives, Investment and Service Components
• Portfolios, Annual Cohorts and Onerous Contract Groups
• Contract Boundary and Insurance Acquisition Cash Flows
• Fulfilment Cash Flow Building Blocks

Day 2: General Measurement Model and Contractual Service Margin

How are profit and risk measured and released over the coverage period?

• Discount Rates: Bottom-Up and Top-Down Methods
• Risk Adjustment for Non-Financial Risk and Confidence Level Disclosure
• Contractual Service Margin Initial Recognition and Subsequent Measurement
• Coverage Units and Profit Release Patterns
• Loss Component for Onerous Contracts

Day 3: Premium Allocation, Variable Fee and Reinsurance Held

When do the alternative measurement models apply, and how is reinsurance treated?

• Premium Allocation Approach Eligibility and Liability for Remaining Coverage
• Liability for Incurred Claims Measurement
• Variable Fee Approach for Direct Participating Contracts
• Reinsurance Contracts Held and Loss-Recovery Component
• Model Selection Matrix by Product Line

Day 4: Presentation, Disclosure and Performance Analysis

How do measurement choices appear in the financial statements and key indicators?

• Insurance Revenue and Insurance Service Expense
• Insurance Finance Income or Expense and the OCI Option
• IFRS 9 Asset and Liability Matching
• Reconciliation and Analysis of Movement Disclosures
• Insurer Key Performance Indicators After IFRS 17

Day 5: Applying the IFRS 17 Reporting and Judgement Review

How are scope, measurement and presentation brought together in one review?

• Judgement Inventory of a Participant Insurer
• Sensitivity Testing of Discount Rate and Risk Adjustment
• Board Pack Narrative for Contractual Service Margin Movements
• Peer Challenge of Measurement Policies
• IFRS 17 Reporting and Judgement Review Presentation

Methodology

The programme relies on data exercises supported by case analysis. Participants work through numerical examples for life, general and reinsurance portfolios, trace each measurement choice into the financial statements and compare published insurer disclosures.

• Suggested activity: Rolling forward a contractual service margin across three reporting periods.
• Suggested activity: Testing whether a short-duration portfolio qualifies for the premium allocation approach.
• Suggested activity: Drafting the board explanation of an insurance service result movement.

Capstone Output

Each participant completes an IFRS 17 reporting and judgement review for their organisation. It lists the key judgements and their sensitivity, model choice by product line, disclosure gaps and the board narrative, ready for the audit committee.

Frequently Asked Questions

Is IFRS 17 measurement and performance reporting suitable for executives who are not actuaries?

Yes. It suits finance directors and audit committee members who challenge actuarial judgements, and assumes familiarity with insurance financial statements but no actuarial qualification.

Which standards underpin IFRS 17 measurement models and insurer performance reporting?

It rests on IFRS 17 Insurance Contracts, including the general measurement model, premium allocation approach and variable fee approach, read alongside IFRS 9 Financial Instruments.

How is the IFRS 17 reporting and judgement review used at work?

You return with a review of your main IFRS 17 judgements, their sensitivity and the board narrative, ready for your audit committee.

How does IFRS 17 performance reporting differ from solvency and capital programmes?

It covers how contracts are measured and reported in the financial statements, rather than how regulatory capital is calculated.