Tag Archives: Takanori Hoshino

IFRS17 coverage units for CSM amortization

While International Financial Reporting Standard (IFRS) 17 provides little guidance about coverage units and the contractual service margin (CSM), insurers may be able to find quick but reasonable choices from current modeling philosophy or certain existing standards such as U.S. GAAP. Insurers should carefully examine the consequences and reasonableness of those choices in light of the characteristics of their businesses, as coverage units are very important factors for determining the future profit signature under IFRS 17. Milliman’s Takanori Hoshino, Kurt Lambrechts, Sjoerd Brethouwer, and William Hines provide perspective in this paper.

Aggregation of risks and allocation of capital

Risk assessment and risk management are critical to survival in today’s business climate, and the accurate calculation of economic capital is more important now than ever before. An effective economic capital management framework also plays a crucial role in product pricing, capital allocation and project financing, performance management, and financial reporting.

A recent Milliman white paper examines various techniques for the aggregation and allocation of capital.