Search for new KPIs in IFRS17 to measure the success of insurance companies
THE IFRS 17 SUPREMACY
by Dr. Servaas Houben
|DRS. S. HOUBEN – AAG FIA CFA FRM – Manager Actuarial at Ergo Insurance
With the introduction of a new accounting standard, the search for KPIs to measure success of insurance companies has begun. Where under IFRS 4 the return on equity or gross written premium measures were common, under IFRS 17 the concept of current and future equity (CSM, RA) has been introduced and premium income has lost its central presence in disclosures and financial reporting. Although the search
for the best KPIs is still ongoing and will change over time based on user experience, I will give an insight on why KPIs play a central role within the finance industry, what the major changes in reporting and KPIs has been from IFRS 4 to IFRS 17, and what logical choices for KPIs could be under IFRS 17 depending on the nature of the insurance business.
This article represents the opinion of the author, and not necessarily the opinion of the AAE.
This article was published in The European Actuary No. 34 – June 2023