Reinsurance held

mimilau5858mimilau5858
in CIA.IFRS17-IC
Hi, could you please confirm on the following questions?

1) Confirm reinsurance held asset is the asset for remaining coverage

2) it states “at initial recognition, CSM can decrease the reinsurance held asset if the present value of reimbursements from reinsurance > reinsurance premiums
and
CSM can increase the reinsurance held asset if the present value of reimbursements from reinsurance < reinsurance premiums “

Are these increases / decreases applied to the loss recovery component? Or to the asset itself, I am confused

Comments

  • Staff-T1Staff-T1

    1) Could also apply to the asset for incurred coverage
    2) It is applied to the asset itself

  • mimilau5858mimilau5858
    The loss recovery component under IFRS17, is subsequently adjusted in subsequent periods to reflect changes in the onerous group of underlying contracts

    It clearly states the loss recovery component is adjusted, is the asset also adjusted? Would that not be double counting?
  • Staff-T1Staff-T1

    In question 6.32, should there be a Loss Recovery Component, I believe the CSM is adjusted to take this into account and prevent double counting for GMM. For the PAA approach you would directly adjust the ARC

  • tshutetshute
    edited October 2022

    In regards to 1):

    @Staff-T1 I originally interpreted this as adjusting the "Reinsurance Contract Held Assets" on the balance sheet (20.10).

    Is this somehow linked to ARC / AIC?

    Edit: I now see the link in the CCIR statements, its pulling from 20.16 & 20.18. All good here :)

  • Staff-T1Staff-T1

    Sounds good :)

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