Release of the XBRL Tool

Objective The objective of EIOPA's Tool for Undertakings project is to provide insurance firms with a simple and basic software tool to create and validate XBRL instances from Solvency II harmonized quantitative reporting templates (QRT). The tool is oriented toward small and medium sized undertakings to create, edit, correct, complete and validate XBRL instance documents. It is designed to help firms without XBRL knowledge to implement Solvency II harmonized quantitative reporting in XBRL. The release documents…

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Solvency II – Day 1

Definition The 1 January 2016 is referred to as Solvency II Day 1. The European wide regulation is in-force ever since. Find the summary here. Concept The concept of Day 1 reporting is described below. All firms that have a company year-end falling on or between 31 December 2015 and 29 June 2016 are required to submit opening Solvency II information, commonly referred to as Day 1 reporting. Firms with…

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IAS 19 – Employee Benefits

Introduction The accounting standard IAS 19 Employee Benefits prescribes rules for recognition of various types of benefits that employers provide to employees. Purpose Main objective of IAS 19 is accounting and disclosure for employee benefits. IAS 19 requires recognition of: a liability when an employee provides their service (work) in exchange for employee benefits (e.g. pension), paid in the future an expense when the entity consumes the economic benefit arising from service…

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Unitised With-Profits

A guide to unitised With-Profits insurance policies Unitised (UWP) as oppose to Conventional (CWP) refers to the units in the With-Profits fund. As a side note, conventional with-profits contracts is when we guarantee to pay out an agreed amount when the policy matures. This could be a lump sum (the sum assured) or a series of payments (an annuity or pension). This guide explains how our with-profits fund works for…

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IFRS Reserving – Non-Life

Introduction Insurance is about sharing risk. At the balance sheet of any insurance company the technical provisions is likely to be an important item. Both in terms of size and in terms of uncertainty. Increasing or decreasing technical provisions has a direct impact on the company’s result. Since setting reserves is about estimating future events there will always be uncertainty involved and the process will at some stage require the…

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Events Not In Data

The concept of Events Not In Data - ENID - is new in terms of terminology. It has also been called Binary Events. It refers to events that may happen in the future and then have a negative impact on the companies loss-ratio. The Low Frequency High Severity events is likely to be included here. Asbestos was an example of a typical ENID. Nowadays since these are in the data…

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Unexpired Risk Reserve – URR

Premiums is the main source of income for an insurance company. Insurers differentiate between written premiums and earned premiums. The former is the premiums that are contracted and usually paid for. The latter refers to the part that is earned in term of the risk exposure. Usually the premium is collected in advance by the insurer. If a client for instance pays for one year of reinsurance by 1 December…

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Unearned Premium Reserve – UPR

Premiums is the main source of income for an insurance company. Insurers differentiate between written premiums and earned premiums. The former is the premiums that are contracted and usually paid for. The latter refers to the part that is earned in term of the risk exposure. Usually the premium is collected in advance by the insurer. If a client for instance pays for one year of reinsurance by 1 December…

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IFRS Reserving – Concept and Models

Concept Insurance is about sharing risk. At the balance sheet of any insurance company the technical provisions is likely to be an important item. Both in terms of size and in terms of uncertainty. Increasing or decreasing IFRS technical provisions has a direct impact on the company’s result. There is plenty of research done on how to calculate technical provisions. There are both simple and practical approaches and complex scenarios…

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