IFRS17 sample question #14
For question (i), why did the answer say coverage period is 2 years?
The question says "underlying policies all have 12-month coverage period". What should be the correct answer to this question (i)?
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For question (i), why did the answer say coverage period is 2 years?
The question says "underlying policies all have 12-month coverage period". What should be the correct answer to this question (i)?
Comments
@HateExams99 The keyword here is risk-attaching reinsurance contracts. The underlying are 12 months but the reinsurance contract is 24 months.
Hope that helps
Thank you, Andrew that is the correct answer. The coverage period lasts for two years as the last underlying contract will be written on Dec 31 xxxx, which means you are only fully done providing coverage on Dec 31 xxx + 1 which is twenty four months after inception
Thank you both!