By Jung Min-hee | Business Korea | May 12, 2023<\/p>\n
Korean insurers\u2019 performances have been noticeably improved in the first quarter of 2023 on the strength of the implementation of the new International Financial Reporting Standard 17 (IFRS 17), according to sources in the Korean insurance industry on May 10.<\/p>\n
The new accounting standard may be more favorable to non-life insurers than life insurers because the higher the proportion of guaranteed insurance is, the more favorable the standard is, insurance industry analysts say.<\/p>\n
This is because the new accounting standard values insurance liabilities at market value instead of cost. Gains and losses will also be recognized over the entire period of a contract instead of cashflow.<\/p>\n
The new accounting standard results in lower liabilities than IFRS4, the previous accounting standard, so it can boost corporate earnings, and a higher proportion of long-term guarantee insurance helps improve corporate earnings, analysts say. This explains why non-life insurers with few savings products can improve their performance better than life insurers.<\/p>\n
In fact, a recent IFRS17 pre-disclosure analysis report by the Korea Insurance Research Institute (KIRI) analyzed the IFRS17\u2019s financial impacts on 22 life insurers and 12 non-life insurers with long-term insurance as of the end of 2022, and found out that the new accounting standard was more favorable for non-life insurers.<\/p>\n
According to KIRI\u2019s analysis of insurers\u2019 abbreviated financial statements as of the end of 2022 prepared in accordance with the IFRS17, the new accounting standard will ramp up non-life insurers\u2019 net income by 51 percent from 4.7 trillion won (US$3.5 billion) under the IFRS4 to 7.1 trillion won (US$5.3 billion). It will also raise life Insurers\u2019 net income by six percent, a relatively low rate, from 3.7 trillion won to 3.9 trillion won (US$2.9 billion).<\/p>\n","protected":false},"excerpt":{"rendered":"
By Jung Min-hee | Business Korea | May 12, 2023 Korean insurers\u2019 performances have been noticeably improved in the first quarter of 2023 on the strength of the implementation of the new International Financial Reporting Standard 17 (IFRS 17), according to sources in the Korean insurance industry on May 10.<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"nf_dc_page":"","neve_meta_sidebar":"","neve_meta_container":"","neve_meta_enable_content_width":"off","neve_meta_content_width":70,"neve_meta_title_alignment":"","neve_meta_author_avatar":"","neve_post_elements_order":"","neve_meta_disable_header":"","neve_meta_disable_footer":"","neve_meta_disable_title":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[9,3],"tags":[],"class_list":["post-1178","post","type-post","status-publish","format-standard","hentry","category-korea","category-news"],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/insurance.vincent-chen.com\/en\/wp-json\/wp\/v2\/posts\/1178","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/insurance.vincent-chen.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/insurance.vincent-chen.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/insurance.vincent-chen.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/insurance.vincent-chen.com\/en\/wp-json\/wp\/v2\/comments?post=1178"}],"version-history":[{"count":1,"href":"https:\/\/insurance.vincent-chen.com\/en\/wp-json\/wp\/v2\/posts\/1178\/revisions"}],"predecessor-version":[{"id":1179,"href":"https:\/\/insurance.vincent-chen.com\/en\/wp-json\/wp\/v2\/posts\/1178\/revisions\/1179"}],"wp:attachment":[{"href":"https:\/\/insurance.vincent-chen.com\/en\/wp-json\/wp\/v2\/media?parent=1178"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/insurance.vincent-chen.com\/en\/wp-json\/wp\/v2\/categories?post=1178"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/insurance.vincent-chen.com\/en\/wp-json\/wp\/v2\/tags?post=1178"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}