| Particulars |
IFRS 17 Options |
Adoption approach |
| Policy acquisition cost |
Where the coverage period of each contract in the group at initial recognition is no more than one year, IFRS 17 allows an accounting policy choice of either expensing the insurance acquisition cash flows when incurred or amortizing them over the contract’s coverage period. |
The Group amortized the insurance acquisition cost for all contracts. The Group allocates the acquisition cost to groups of insurance contracts issued or expected to be issued using a systematic and rational basis. |
| Liability for Remaining Coverage (“LRC”) adjusted for financial risk and time value of money |
Where there is no significant financing component in relation to the LRC, or where the time between providing each part of the services and the related premium due date is no more than a year, the Group is not required to make an adjustment for accretion of interest on the LRC. |
For PAA model, Group has elected not to adjust the Liability for Remaining Coverage for discounting, as it expects the time between providing each part of the coverage and the related premium due date to be one year or less |
| Liability for Incurred Claims (“LIC”) adjusted for time value of money |
Where claims are expected to be paid within a year of the date that the claim is incurred, it is not required to adjust these amounts for the time value of money. |
Group will discount all future incurred claim cashflows. |
| Insurance finance income and expenses |
IFRS 17 provides an accounting policy choice to recognize the impact of changes in discount rates and other financial variables in profit or loss or in OCI. The accounting policy choice (the PL or OCI option) is applied on a portfolio basis. |
Entire insurance finance income or expense for the period will be presented in the statement of profit or loss. |
| Disaggregation of risk adjustment |
An insurer is not required to include the entire change in the risk adjustment for non-financial risk in the insurance service result. Instead, it can choose to split the amount between the insurance service resultant insurance finance income or expenses. |
The entire risk adjustment will be presented in insurance service result by the Group. |
| Presentation in the statement of income – Reinsurance |
The Group may present the income or expenses from a group of reinsurance contracts held, other than insurance finance income or expenses, as a single amount; or the Group may present separately the amounts recovered from the reinsurer and an allocation of the premiums paid that together give a net amount equal to that single amount |
Reinsurance cession and recoveries will be presented separately in the statement of profit or loss by the Group. |
| Adjustments of estimate would take place on an annual basis |
The Group shall apply its choice of accounting policy to all groups of insurance contracts it issues and groups of reinsurance contracts it holds. |
Adjustments of estimate would take place on an annual basis. |
