IASB delays insurance contract rules for one year: PwC comments

Commenting on the decision from yesterday’s IASB meeting, subject to the IASB’s due process, that the IFRS17 insurance accounting standard will be delayed by one year and the extension of the deferral of IFRS 9 to the same date, Alex Bertolotti, IFRS17 leader at PwC, said:

“Yesterday’s announcement of a one-year delay to the implementation of IFRS17 will be welcomed by many in the insurance community. The additional time will help alleviate some risk from existing plans, however many companies still have a lot to do and cannot afford to press pause.

“Some insurers have been lobbying for this delay for a while, as the initial time frame was exceedingly tight. Others have been requesting clarification over certain aspects of the standard, without which it would have been difficult or prohibitively costly to move ahead.

"The impact of the one year delay can only be fully assessed after reviewing potential changes to the standard which the IASB Board will consider in December.

“Our message to insurers would be not to stop - there’s so much to do. If you haven’t started, get a move on. To stand still is to fall behind.”

“South African insurers, through The Association for Savings and Investment South Africa (ASISA), were supportive of this delay and those insurers that have not yet started their IFRS 17 journey will welcome the extra time. Reading between the lines, I do not expect much change to the standard,” Dewald van den Berg, PwC South Africa’s IFRS 17 technical lead commented.

“Those South African insurers who have embarked on their implementation journey should keep the momentum going, while the other players should not delay and should use the extra time wisely,” Chantel van den Heever, PwC South Africa’s IFRS 17 lead concluded.