Enkeleda Shehi
Roel Shehi
Abstract:
This paper explores two key frameworks in the insurance industry: IFRS 17, an accounting standard implemented in 2023 to unify global insurance contract reporting, and Solvency II, a regulatory regime established in 2016 to ensure capital adequacy and risk management within the EU. While both aim to enhance transparency and financial stability, they differ in scope, purpose, and application. IFRS 17 focuses on long-term profit recognition using concepts like the General Measurement Model (GMM) and Contractual Service Margin (CSM), while Solvency II emphasizes short-term solvency through market-consistent valuations. Key differences include risk adjustment methodologies and the specification of liquidity premiums.
This paper also addresses challenges in operational implementation, costs, stakeholder expectations, and data integration. Despite these hurdles, the synergies between the frameworks present opportunities for harmonization, improved transparency, and stakeholder confidence, marking a significant step forward for global insurance markets
Tenth International Scientific-Business Conference LIMEN Leadership, Innovation, Management and Economics: Integrated Politics of Research - LIMEN 2024 - International Scientific-Business Conference β LIMEN 2024: Vol 10. Conference Proceedings , December 5, 2024
Conference Proceedings published by: Association of Economists and Managers of the Balkans, Belgrade, Serbia
ISBN: 9788680194929 , ISSN: 26836149 , DOI: 10.31410/LIMEN.2024
Creative Commons Non Commercial CC BY-NC: This article is distributed under the terms of the Creative Commons Attribution-Non-Commercial 4.0 License (https://creativecommons.org/licenses/by-nc/4.0/) which permits non-commercial use, reproduction and distribution of the work without further permission.
