The following video is by Karen Grote, Senior Director at WTW. It discusses how the International Financial Reporting Standard 17 (IFRS 17) introduces significant changes to accounting in the insurance industry, including the concept of a risk adjustment. The risk adjustment is recalculated at each reporting date and disclosed separately in financial statements. Insurers should develop a clear methodology, align risk adjustment calculations with their overall risk management framework, and implement robust data management and analytics capabilities to support these calculations.
Contributors: Karen Grote, FSA, MAAA; Tiana Zhao, FSA, CERA ; Weiling Lao, FSA, MAAA , Jon Forster ASA, MAAA