IFRS 17 requires insurers to set appropriate discount rates for liabilities. Whilst IFRS 17 sets out broad principles, there are many techniques and methods that could be used to set suitable rates. The working party will consider the different ways discount rate mechanisms might operate, how actuaries may set up an appropriate framework, and draw attention to some of the advantages and disadvantages that might be encountered in practice.
Key objectives:
- Compile and review current literature in the life insurance arenas to ensure access to up to date information.
- Consider the pros and cons of different methods for setting discount rates.
- Provoke thought leadership and innovation within the industry through presentations and forums to gain wider input.
Key outputs:
- Presentations at conferences
- A range of articles (see below)
Articles in The Actuary, other publications and in other forums.
Articles published to date include:
- IFRS 17 – Default Model – Historic Calibration by James Sharpe
- The IFRS 17 Income Statement and how this is affected by the Discount Rate Methodology, by Jon Neale
- Other Financial Risk under IFRS 17, by Richard Schneider and Jonny Skerratt
- Summary of the Draft Educational Note on Discount Rates Issued by the Canadian Institute of Actuaries, by Jon Neale
- Index-linked liabilities under IFRS 17 – considerations, by Darren Clay and Richard Schneider
- Imperfect numbers under IFRS 17 by Kunj Behari Maheshwari & Brian Ring
- Setting ‘bottom-up’ discount rates under IFRS 17 for General Insurers, by Charlotte Edwards and Apostolos Papachristos
- A summary of the issues the working party is considering
- A balancing act: Companies should not assume their existing discount rate approaches will comply with IFRS 17, warns Daryl Boxall
- IFRS 17 Discount Rate Considerations, by Darren Clay & James Latto
- Locked-in stochastic discount rates under IFRS 17, by Richard Schneider
- Case study on the top-down approach, by Apostolos Papachristos
- IFRS 17: liquidity characteristics of insurance liabilities, by Thomas Bulpitt
- Discount rate disclosures, by Jon Neale
| Chair: | Richard Olswang |
|---|---|
| Membership: | 14 |
| Established: | 2018 |
Contact Details
If you want more information about this research working party please contact the Communities Team.
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Events calendar
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ARC Webinar Series 2021: Modelling cancer risk: regional and socioeconomic disparities
30 September 2021
Cancer incidence and mortality vary by region and socioeconomic status. Modelling the structure development and trends of cancer risk is important for insurance purposes and can impact pricing and reserving in related health insurance fields such as critical illness insurance and care provision. -
Sustainability Series: What will COP26 mean for investment?
6 October 2021
A panel discussion with investment representatives discussing the impact of investment on climate change and vice versa.This event is part of The Road to Glasgow: IFoA’s Sustainability Thought Leadership Series which will provide a platform for prominent contributors so that our members and others can understand the perspectives of a wide range of parties interested in the climate debate.
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Climate change is one of the greatest risks facing our world today. Addressing it will require multi-faceted solutions. Through this panel session, we will explore the different levers that can be used to meet net-zero targets including climate science and data, government engagement, and mobilising green finance.
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Sustainability Series: Climate Justice and Future Generations
12 October 2021How governments and societies collectively respond to the climate crisis is increasingly being analysed through the lens of intergenerational fairness. Our expert panel will assess and explore the extent to which inter-generous fairness is being considered in climate policies, the lessons from those countries who are leading the way on fairness and justice in climate interventions, and more. -
The Growth Mindset for Actuaries
13 October 2021 - 8 December 2021This practical course is aimed at actuaries at any stage of their career who want to develop their own growth mindset and apply it to their work setting and personal or professional lifelong learning. The content of the course builds on the lecture given by Dr Helen Wright on Growth Mindset as part of the President’s 2021 Lecture series, and will be delivered over a period of 2 months, from mid-October to early December.
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Sustainability Series: Opportunities for Insurers
14 October 2021 -
The climate crisis and the degradation of our planet will affect societies everywhere. How we address these threats will require solutions that transcend borders. As a global profession, the actuarial community is well-placed to consider and propose effective risk management solutions to help manage the climate crisis.
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What next for Mental Health in Insurance?
1 December 2021
Content will be aimed at all actuaries looking to understand the issues surrounding mental health in insurance and in particular those looking to ensure products and processes widen access for, and are most useful to, those experiencing periods of poor mental health.
Cancer incidence and mortality vary by region and socioeconomic status. Modelling the structure development and trends of cancer risk is important for insurance purposes and can impact pricing and reserving in related health insurance fields such as critical illness insurance and care provision.
A panel discussion with investment representatives discussing the impact of investment on climate change and vice versa.
Content will be aimed at all actuaries looking to understand the issues surrounding mental health in insurance and in particular those looking to ensure products and processes widen access for, and are most useful to, those experiencing periods of poor mental health.