03 February 2020
IFRS 17 Insurance Contract (International Financial Reporting Standards) is the new accounting standards for insurance contracts. IFRS 17 was introduced on May 2017 by International Accounting Standards Board (IASB) and it is a profound development on setting out a common global accounting standard on measurement, recognition of profit and loss, presentation and disclosure of insurance contracts.Read More
03 February 2020
IFRS 17 Insurance Contract (International Financial Reporting Standards) is the new accounting standards for insurance contracts. IFRS 17 was introduced on May 2017 by International Accounting Standards Board (IASB) and it is a profound development on setting out a common global accounting standard on measurement, recognition of profit and loss, presentation and disclosure of insurance contracts.
IFRS 17 is essentially replacing the Interim Standard (IFRS 4) which allowed insurance companies to employ various accounting practices based on their jurisdiction and their company’s policy (GAAP – Generally Accepted Accounting Principles). IFRS 17 was originally scheduled to be applied on or after 1st January 2021, however, the IASB has deferred the implementation date to 1st January 2022.
Overview and Objectives
The new Standard requires insurance companies to identify and group contracts with similar risks into same portfolio of contracts of the same year i.e. whole life insurance contracts of 2017 as a group, vehicle insurance contracts of 2017 as another group. Each portfolio will then be divided into a minimum of three groups based on the expected profitability:
However, firms are not allowed to group contracts that are issued more than one year apart together. They may put contracts in the same group under the condition that grouping them in different groups will result in limiting the insurer’s ability to set a different price or level of benefits for different types of policyholders. Overall, the IFRS 17 aims to provide investors with more transparent and comparable information. Users can better understand the insurer’s financial position, performance and risk exposure while insurance companies on the other hand can benefit from the globally standardised accounting standard (for example, reducing long-term compliance costs, especially for multinational insurers).
Main measurement approaches
IFRS 17 oblige insurance companies to reflect in their balance sheet the fulfilment cash flows and the contractual service margin. The amounts reported in the balance sheets must be updated at the date of report so as to reflect current discount rates, and estimates of the account, the timing of cash flows and the uncertainty relating to insurance contracts. Furthermore, the IFRS 17 provide for extensive disclosure obligations on the insurance companies enabling the better understanding of the amounts estimated. Specifically, the IFRS 17 provide for the following methods of measurement:
How this impacts you?
In the context of insurers, IFRS 17 may impact the insurer’s financial performances, change in profit emergence pattern, change in the presentation of balance sheet and income statement which could affect dividends, tax and remuneration. It will also have operational impacts on data, systems and processes. IFRS 17 adds complexity and costs on compliance and staffs need to be trained to cope with the new standard. However, the new standard will speed up the recognition of onerous contracts and losses and provide better risk management.
In the context of policyholders and investors, the IFRS 17 will help to create higher level of transparency. Thus, providing better insights for easier comparison of firms and improve investors’ confidence. Also, liabilities will be valued at market value and there will be a truer reflection of profits.
All in all, the IFRS 17 will be one of the most disruptive changes to the insurance industry. However, the European Insurance and Occupational Pensions Authority (EIOPA) concludes that significant efficiency gains are expected.Read More
08 July 2019
In the Compensations booklet below, you may find a summary of all rulings issued by the Cypriot courts in 2018, in which compensations were awarded for damages resulting from any form of accident. The purpose of this report is to give an indication of the amount of compensation given for various accident cases.Read More
08 July 2019
In the Compensations booklet below, you may find a summary of all rulings issued by the Cypriot courts in 2018, in which compensations were awarded for damages resulting from any form of accident. The purpose of this report is to give an indication of the amount of compensation given for various accident cases.
24 June 2019
Following an audit carried out in the insurance sector, the Commissioner for Personal Data Protection (the Commissioner) published her findings about the improvements to be made and accomplished before the end of June.Read More
13 May 2019
The proposal, as submitted by the Commission, seeks to amend the Motor Insurance Directive (2009/103/EC) in five specific areas: (i) insolvency of the insurer; (ii) claims history; (iii) risks due to uninsured driving; (iv) minimum amounts of cover; and (v) scope of the Directive.Read More
21 August 2018Read More
31 October 2016Read More
20 February 2013Read More
26 November 2012Read More
30 July 2012Read More
19 June 2020
Harris Kyriakides LLC contributes the Cyprus chapter in the International Comparative Legal Guide to: Product Liability 2020. The guide provides a practical cross border insight into product liability work.Read More
01 June 2020
In our Compensations booklet for 2019, you may find a summary of all rulings issued by the Cypriot courts in 2019, in which compensations were awarded for damages resulting from any form of accident. The purpose of this report is to give an indication of the amount of compensation given for various accident cases.Read More
02 October 2017Read More
20 January 2016Read More
10 March 2014Read More
23 January 2012Read More
18 April 2019
We are proud for being recommended by The Legal 500 in Dispute Resolution, EU and competition and Real estate and Construction.Read More
24 April 2017
Michalis Kyriakides, a partner at Harris Kyriakides LLC, has been identified by “Who’s Who Legal” 2017Read More
27 January 2014
We operate one of the largest insurance and personal injury practices in Cyprus with an unmatched high client satisfaction rate. We represent individuals, major insurance companies as well as private corporations active in the insurance sector. We also represent overseas insurance companies and international corporations that operate in insurance led industries for major jurisdictions and international financial centres.
Our civil trial practice covers a broad range of contentious matters:
When we act on behalf of defendants, our team always seeks to identify fraudulent and exaggerated claims from an early stage. Moreover, we deliver early stage liability advice and aim to achieve an early cost-effective settlement and engage in constructive communications with claimants in order to achieve an early resolution. If, however, claims are led to a trial, our experienced litigation team provides representation that truly protects the interests of our clients.
If you have suffered an injury as a result of a traffic or workplace accident, medical malpractice, a defective product, nursing home abuse, an animal bite, or if your case relates to any of the aforementioned practices, you should consider getting advice from one of our personal injury lawyers. Our legal team can help you claim compensation so that you can use the money claimed towards medical expenses, lost salaries, pain and suffering, temporary or permanent disability and other injury-related expenses. We offer a free initial consultation so that we will be able to tell you if you have a justifiable claim, how likely your case is to succeed and what the value of your claim may be. We have assembled a team of dedicated legal professionals, who can visit you wherever you are and confidently guide you throughout the whole process.
In regard to non contentious matters, we regularly advise and opine on liability and quantum issues subject to the Cyprus law as well as other matters related to Cyprus insurance law. We also deal with matters related to coverage opinions, claims analysis, regulatory compliance and endorsements.