# Embattled Insurance Industry Faces Extreme Challenge According To Extensive Global Report On Ifrs 17 Readiness Author: Pal Sinha, Barnali Author URL: https://financedigest.com/author/pal-sinha-barnali Published: 2018-01-13 Category: INSURANCE Category URL: https://financedigest.com/category/insurance Meta Title: Global IFRS 17 Readiness Assesment Report (GIRA) Reveals Meta Description: Aptitude Software's Global IFRS 17 Readiness Assessment Report highlights the urgent need for insurance companies to invest in new processes to meet URL: https://financedigest.com/embattled-insurance-industry-faces-extreme-challenge-according-to-extensive-global-report-on-ifrs-17-readinesshtml ![undefined](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/embattled-insurance-industry-faces-extreme-challenge-according-to-extensive-global-report-on-ifrs-17-readiness-1736843079500-compressed.jpg) **Data from 240 insurance companies reveal 92% of insurers have yet to put their IFRS 17 solutions in place and 88% recognise they need to invest in new processes to support disclosure requirements.** **11 January, 2018** Aptitude Software, the financial software specialist, has published its first bi-annual Global IFRS 17 Readiness Assessment Report (GIRA) to assist CFOs and their finance teams in addressing IFRS 17, the most significant change to insurance accounting that has ever taken place. IFRS 17 is a new global accounting reporting standard for insurance contracts that affects every insurance company that reports under IFRS. Its purpose is to [align insurance company reporting](https://www.financedigest.com/global-body-urges-eu-to-make-company-life-simpler-by-aligning-climate-reporting.html "Global body urges EU to make company life simpler by aligning climate reporting") across the globe. The International Accounting Standards Board (IASB) suggests that 450 listed [insurers](https://www.financedigest.com/different-countries-different-insurance-cultures-how-insurers-can-adapt-their-products.html "insurers") use IFRS standards, which means approximately $13 trillion (£9.8 trillion) of total assets are impacted. Aptitude’s GIRA report includes [data from 240 insurance](https://www.financedigest.com/how-data-is-revolutionising-car-insurance.html "How data is revolutionising car insurance") companies worldwide, from insurers of all sizes including those with gross written premiums (GWP) of over $50 billion and life and non-life insurance companies. Key findings from the report show that [insurance companies recognise the scale of the project and the significant risks](https://www.financedigest.com/improving-risk-management-in-the-insurance-industry.html "Improving risk management in the insurance industry") to implementing IFRS 17. It also shows that the majority of insurers are beginning to take action but they are still at a very early stage in the planning and implementation process, considering [change programmes](https://www.financedigest.com/ubs-makes-changes-to-buyback-programme-following-credit-suisse-takeover.html "UBS makes changes to buyback programme following Credit Suisse takeover") are expected to run between 12-30 months: - 92% of companies have yet to put their IFRS 17 solutions in place. - 78% of companies are in the early research and [impact analysis](https://www.financedigest.com/industrial-catalytic-converter-market-size-share-forecast-report-2027-covid-19-impact-analysis-fmi.html "Industrial Catalytic Converter Market Size, Share, Forecast Report – 2027 – COVID-19 Impact Analysis | FMI") phase. - 88% of [companies said they would need](https://www.financedigest.com/why-companies-need-to-rethink-retirement-tips-for-ensuring-a-happy-life-in-later-years.html "Why companies need to rethink retirement – Tips for ensuring a happy life in later years") new processes to support IFRS 17 disclosure requirements. Martin Redington, Chief Technology Officer, Aptitude Software comments: “IFRS 17 is the most significant change to insurance accounting that has ever taken place and is the latest of many pressures facing insurance CFOs. [Insurance company profits are under duress as many sectors have become commoditised and many firms recognise the need](https://www.financedigest.com/breaking-down-the-types-of-insurance-you-need.html "Breaking Down the Types of Insurance You Need") to innovate their offerings and operations. In a post-IFRS 17 world, it will be difficult for CFOs to service the many financial and regulatory requirements without an [approach](https://www.financedigest.com/uks-finance-minister-sets-out-new-economic-approach-to-finance-bosses.html "UK’s finance minister sets out new economic approach to finance bosses") that centralises control of reporting and financial data. IFRS 17 is already proving to be the straw that broke the camel’s back, [driving insurance](https://www.financedigest.com/whats-driving-consumer-opinion-in-the-insurance-sector.html "What’s driving consumer opinion in the Insurance Sector?") CFOs to modernise their financial systems.” Ernst & Young estimates that even smaller [life insurers](https://www.financedigest.com/what-type-of-life-insurance-policy-is-right-for-me.html "What Type of Life Insurance Policy Is Right For Me?"), those with < $10bn Gross Written Premium (GWP), will need a budget of $25million for IFRS 17 projects, and for those larger insurers with >$25bn GWP they will need to spend upwards of $150 million to achieve compliance. The GIRA report identifies a wide range of [challenges that insurers need to overcome](https://www.financedigest.com/how-to-overcome-the-challenges-faced-by-women-in-business-3.html "How to Overcome the Challenges Faced by Women in Business") on their journey to implementation. 84% of respondents cited having a disparate actuarial environment being a constraint to delivering consistent calculations. 88% of [insurance](https://www.financedigest.com/digital-marketing-for-finance-and-insurance-firms-is-changing-are-you-ready.html "Digital marketing for finance and insurance firms is changing — Are you ready?") companies highlighted that they would need new processes to support IFRS 17 financial disclosure requirements. Martin Redington added: “Many [insurers are coming](https://www.financedigest.com/are-you-getting-what-you-are-paying-for-when-it-comes-to-cyber-liability-insurance.html "ARE YOU GETTING WHAT YOU ARE PAYING FOR WHEN IT COMES TO CYBER LIABILITY INSURANCE?") to grips with IFRS 17, identifying the paths to address the financial accounting change requirements as well as the opportunities to modernise their actuarial and finance systems environments. 88% of [insurers we spoke to recognise the need to invest](https://www.financedigest.com/classic-car-insurance-broker-launches-future-classic-investment-guide.html "Classic car insurance broker launches Future Classic investment guide") in new processes to support IFRS 17 disclosure requirements. We are working with CFOs and their finance teams to put [software solutions](https://www.financedigest.com/healthcare-software-solutions-to-ride-the-immunohematology-market.html "Healthcare Software Solutions to ride the Immunohematology Market") in place to address the end-to-end IFRS 17 financial reporting process and to future proof their business capabilities.” The GIRA report also identified a potential skills shortage as 39% of insurers are [expected](https://www.financedigest.com/u-n-expects-ukraine-russia-grain-deal-to-be-implemented-in-a-few-weeks-officials.html "U.N. expects Ukraine-Russia grain deal to be implemented in a few weeks -officials") to kick off their implementation projects in Q2 2018 meaning many insurers will be implementing IFRS 17 solutions at the same time. KPMG’s ‘Navigating Change’ report (which surveyed more than 80 insurance executives in September and October 2017) also identified this as a [key issue with 80% of insurance executives stating that they see finding enough people with the right skills as a key challenge](https://www.financedigest.com/refurbished-medical-imaging-equipment-market-comprehensive-study-with-key-trends-major-drivers-and-challenges-2018-2026.html "Refurbished Medical Imaging Equipment Market: Comprehensive Study with Key Trends, Major Drivers and Challenges 2018-2026"). Martin Redington added: “Time is of the essence. [Insurers need to be selecting](https://www.financedigest.com/5-tips-for-selecting-the-best-car-insurance-coverage.html "5 Tips for Selecting the Best Car Insurance Coverage") their vendors now and working on implementing IFRS 17 financial accounting solutions to avoid the skills shortage and ensure they comply in time. IFRS 17 is a massive project with significant risks. There is not a one [size fits all solution](https://www.financedigest.com/automotive-navigation-solutions-market-size-and-key-trends-in-terms-of-volume-and-value.html "Automotive Navigation Solutions Market Size and Key Trends in Terms of Volume and Value"), bespoke solutions are required. Without an appropriate plan and systems in place we will see more [insurers requesting delays to the IASB with others resorting to brute force to meet](https://www.financedigest.com/how-omnichannel-cx-can-help-insurers-meet-customer-expectations.html "How omnichannel CX can help insurers meet customer expectations") the deadline.” Aptitude’s IFRS 17 software enables insurance CFOs to comply efficiently with a platform to manage the end-to-end IFRS 17 financial [accounting process](https://www.financedigest.com/things-mortgage-lender-takes-into-account-when-processing-an-application.html "Things Mortgage Lender Takes Into Account When Processing an Application"). It reduces the [cost and risk of IFRS 17 change programmes with a specialist product approach that leverages Aptitude Software’s proven operational](https://www.financedigest.com/uk-pub-operator-wetherspoons-loss-narrows-despite-higher-costs.html "UK pub operator Wetherspoon’s loss narrows despite higher costs") accounting platform and fits into existing actuarial and financial reporting environments. Aptitude’s Global IFRS 17 Readiness Assessment Report [https://www.aptitudesoftware.com/global-ifrs-17-readiness-assessment-report/](https://www.aptitudesoftware.com/global-ifrs-17-readiness-assessment-report/) will continue to be published on a bi-annual basis. --- This blog is powered by Superblog. Visit https://superblog.ai to know more. ---