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“We remain concerned about the data and systems challenges that insurers will face in preparing for the new standard, but feel that the additional year will provide some buffer for insurers’ implementation projects. However, we hope that any final amendments to the standard are settled as soon as possible so that the additional 12 months can be devoted chiefly to preparation rather than debate. Given the material change to reporting with IFRS 17, we assume insurers also might use the extra time for transparent communication,” said S&P.
Others have also welcomed the delay in implementation of IFRS 17. Analytics specialist SAS said the delay was “a welcome reprieve for insurance professionals, as our research found that businesses simply are not prepared for the change”.
According to an SAS survey, an overwhelming majority (97%) of senior UK insurance professionals expect IFRS 17 to increase the complexity and cost of operating in the industry when it comes into force. While the standard does not now come into force until 1 January 2022, a majority (61%) have already started preparation for the changes, and 19% classed it as a top strategic priority.
SAS said that despite the added preparation time, planning is essential. The majority of respondents (77%) still expect interpretation of the standard to evolve considerably between 2019 and 2020. At the time, most companies (60%) were taking a tactical, flexible approach, before refining their solution closer to the deadline, according to SAS.
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