Detailing the new accounting for long-duration contracts of insurers (Updated May 16, 2019)

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In depth , PwC US May 16, 2019

We’ve updated our In depth to reflect our latest thinking on the implementation of the new long-duration insurance guidance.

About the new accounting for long-duration contracts of insurers

New FASB guidance revises key elements of the measurement models and disclosure requirements for long-duration contracts issued by insurers and reinsurers. It is the biggest change in US GAAP reporting for life insurers in the last 40 years.

The FASB’s objective is to improve, simplify, and enhance accounting for long-duration contracts. Overall, there may be a significant impact to reported earnings and increased earnings volatility. Additionally, the implementation effort will require significant changes to systems, processes, and controls, and likely require the accumulation of data that has not previously been captured and included in the actuarial models in the format and grouping needed for the measurement.

This In depth details the new guidance and has been updated as of May 16, 2019 to reflect our latest thinking on certain accounting implementation issues impacting life insurers adopting the new insurance guidance. The impacted sections have been marked as revised. In addition, we’ve added an appendix with FAQs and another detailing the disclosure requirements.

To have a deeper discussion, contact:

Donald Doran

Partner, National Professional Services Group, PwC US

Email

Tom Barbieri

Partner, National Professional Services Group, PwC US

Email

Mary Saslow

Managing Director, National Professional Service Group, PwC US

Email

Eric Alemian

Director, National Professional Services Group, PwC US

Email

Contact us

David Schmid

International Accounting Leader, National Professional Services Group, PwC US

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