FASB delays US life insurance accounting standard by 1 year

Written by Adam Cadle

11/06/2020

The Financial Accounting Standards Board (FASB) is to issue a proposed Accounting Standards Update (ASU) granting US insurance companies that issue long-duration contracts, such as life insurance and annuities, an additional year to implement its standard that improves financial reporting.

The ASU update aims to improve the timeliness of recognising changes in the liability for future policy benefits and modify the rate used to discount future cash flows. It also aims to simplify and improve the accounting for certain market-based options or guarantees associated with deposit (or account balance) contracts, simplify the amortisation of deferred acquisition costs and improve the effectiveness of the required disclosures.

Stakeholders will have 45 days to review and provide comment on the proposed ASU, which the FASB expects to issue in the coming weeks.

Related Articles