IFRS 17 disclosures

IFRS 17 disclosures run to dozens of pages in an insurer's annual report, and they are where most of the useful information sits. This guide sets out what is required, shows what a claims development table looks like and how it supports the balance sheet, and explains how readers can use the CSM disclosures.

By Hamza Fida, Chartered Accountant. Reviewed by Mirza Fahad Baig, Chartered Accountant. 3 minute read.

Short answer

IFRS 17 disclosures explain the amounts in an insurer's financial statements, the judgements behind them, and the risks the contracts create. The core are reconciliations of insurance liabilities from opening to closing, split between the liability for remaining coverage, the loss component and incurred claims, and for the general measurement model between estimates of future cash flows, the risk adjustment and the CSM. Insurers also disclose new business, when the CSM is expected to be released, the risk adjustment's confidence level, discount rates, sensitivities and a claims development table. In this guide's example, a three-year claims table supports an incurred claims liability of 625.

At a glance

Reconciliations
LRC, loss component, incurred claims
GMM only
Cash flows, RA and CSM roll-forward
New business
Effect of contracts recognised in the year
CSM release
Expected pattern by time band
Judgements
Methods, discount rates, RA confidence
Risk
Sensitivities, claims development
IFRS 17 disclosuresReconciliations: LRC, loss component, incurred claims; GMM only: Cash flows, RA and CSM roll-forward; New business: Effect of contracts recognised in the year; CSM release: Expected pattern by time band; Judgements: Methods, discount rates, RA confidence; Risk: Sensitivities, claims development.KEY FACTS AT A GLANCEIFRS 17 disclosuresReconciliationsLRC, loss component,incurred claimsGMM onlyCash flows, RA and CSMroll-forwardNew businessEffect of contractsrecognised in the yearCSM releaseExpected pattern by timebandJudgementsMethods, discount rates,RA confidenceRiskSensitivities, claimsdevelopmentTax BakersIFRS 17 disclosuresReconciliations: LRC, loss component, incurred claims; GMM only: Cash flows, RA and CSM roll-forward; New business: Effect of contracts recognised in the year; CSM release: Expected pattern by time band; Judgements: Methods, discount rates, RA confidence; Risk: Sensitivities, claims development.KEY FACTS AT A GLANCEIFRS 17 disclosuresReconciliationsLRC, loss component, incurred claimsGMM onlyCash flows, RA and CSM roll-forwardNew businessEffect of contracts recognised in the yearCSM releaseExpected pattern by time bandJudgementsMethods, discount rates, RA confidenceRiskSensitivities, claims developmentTax Bakers
Key facts at a glance, as set out in this guide.

What do IFRS 17 disclosures require?

The main IFRS 17 disclosuresThe main IFRS 17 disclosuresShowsApplies toLiabilityreconciliationsOpening toclosingAll modelsCash flows, RAand CSMWhat drivesthe CSMGMM and VFANew businessProfit addedthis yearGMM and VFAClaimsdevelopmentReliability ofestimatesLong-tailclaimsSensitivitiesExposure torisksAll
Reconciliations explain the numbers; risk disclosures explain the exposures.
  • Two sets of reconciliations: one split into the liability for remaining coverage excluding the loss component, the loss component and the liability for incurred claims; and, for contracts not under the PAA, one split into estimates of the present value of future cash flows, the risk adjustment and the CSM.
  • Insurance revenue analysis: expected claims and expenses, the change in the risk adjustment, the CSM released and the allocation of acquisition cash flows.
  • New business: the effect of contracts initially recognised in the year on the present value of outflows, inflows, the risk adjustment and the CSM, with onerous contracts shown separately.
  • Expected CSM release: when the closing CSM is expected to be recognised in profit, in time bands.
  • Judgements: methods and inputs, the yield curves used to discount, and the confidence level of the risk adjustment.
  • Risks: concentrations, sensitivities to insurance and market risks, liquidity, and claims development.

What does a claims development table show?

How estimates of claims for each accident year have changed over time, compared with what has been paid, so readers can judge how reliable the insurer's estimates are.

Accident yearEstimate at end of 202320242025Paid to dateOutstanding
202350052051048030
2024600630450180
2025700300400
Undiscounted outstanding claims610
Effect of discounting(25)
Risk adjustment40
Liability for incurred claims625

The 2024 accident year has developed adversely, from 600 to 630, while 2023 has settled slightly favourably. The table must cover claims back to when their timing and amount were first uncertain, up to ten years, but not claims whose uncertainty is usually resolved within a year, and it must reconcile to the balance sheet.

How can readers use the CSM disclosures?

The CSM reconciliation shows how much profit was added by new business, how much was released, and how much changed because of revised estimates. The expected release pattern shows how much future profit is already locked in. New business CSM compared with the year's sales gives a view of new business profitability that premiums alone cannot.

How do disclosures differ for PAA business?

Contracts under the premium allocation approach need only the first reconciliation, with the liability for incurred claims split between the present value of future cash flows and the risk adjustment. There is no CSM to reconcile.

At what level are the disclosures made?

Insurers aggregate so that useful information is not obscured by detail or lost in aggregation, typically by type of contract, such as life, non-life and reinsurance, by geography or by reportable segment. Contracts under the PAA, the GMM and the VFA often appear in separate reconciliations.

Are there transition disclosures?

Yes. Until the related contracts run off, insurers disclose insurance revenue and the CSM separately for contracts that were measured at transition using the modified retrospective approach and the fair value approach, so readers can see how much of the CSM came from transition choices. See the contractual service margin, the risk adjustment and insurance accounting under IFRS 17.

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Questions people ask

What does IFRS 17 require insurers to disclose?

Reconciliations of insurance liabilities, an analysis of insurance revenue, the effect of new business, the expected CSM release, significant judgements, and information about risks including claims development.

What is a claims development table?

A table comparing how estimates of claims for each accident year have changed over time with amounts paid, reconciled to the liability for incurred claims.

Which reconciliations does IFRS 17 require?

One by liability for remaining coverage, loss component and incurred claims, and for non-PAA contracts one by future cash flows, risk adjustment and CSM.

Must insurers disclose the risk adjustment confidence level?

Yes, the confidence level used or the one the risk adjustment corresponds to.

Sources

Every fee, date and rule on this page was taken from these official and primary sources.

  1. IFRS Foundation: IFRS 17 Insurance Contracts

Rules and fees change. If you are reading this long after October 7, 2026, confirm the figures with the source before you rely on them.

InsuranceThe contractual service marginInsuranceThe risk adjustment for non-financial riskInsuranceInsurance accounting: IFRS 17 in practice

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This guide is general information. It is not tax or legal advice for your situation.