The Boards clarified that, for cash flows not subject to mirroring that are affected by asset returns:
- the discount rate would reflect the extent to which the estimated cash flows are affected by the return from those assets
- an insurer would reset the locked-in discount rate that is used to present interest expense for those cash flows when there is any change in expectations of cash flows due to changes in the crediting rate for the insurance contracts.
The IASB decided:
- that all rights and obligations for all insurance contracts would be presented on a net basis, with separate line items for insurance and reinsurance contracts in the statement of financial position
- to require additional disclosures on contracts with cash flows contractually linked to underlying items, the earned premium presentation and transition.
The FASB decided that ceding commissions that are not contingent on claims or benefits experience would be treated as a reduction of premiums ceded to the reinsurer.
The FASB decided on accounting for business combinations involving insurance contracts and portfolio transfers.
The IASB intends to undertake fieldwork as part of the re-exposure of the insurance contracts proposals.