Bridging the gap between IFRS and Solvency II Capital Generation: A case study

Insurance companies that report under International Financial Reporting Standards (IFRS) need to fulfil the requirements of the new IFRS 9 and IFRS 17. These new regulations will have implications for the balance sheet management of insurers, and consequently impacts their capital generation. In this paper, we present a case study to illustrate the similarities and differences of reporting capital generation under the new IFRS standards and Solvency II. Topics include: 

• IFRS valuation principles 
• Harmonizing IFRS and Solvency II, or not? 
• Example of how Solvency II and IFRS results could look like for traditional and unit-linked business