Accounting Standard Updates
12 Days of SSAP: Long-Duration Contract Delays
Article reading time: 30 seconds
As the holidays approach, JLK Rosenberger is taking a new perspective on a holiday classic – the Twelve Days of Christmas. Rather than filling your head with turtle doves and gold rings, we are focusing on the latest changes to SSAP and how they will impact your insurance company in 2020 and beyond.
This article covers the latest on Accounting Standards Update No. 2018-12, Financial Services-Insurance (Topic 944) – Targeted Improvements to the Accounting for Long-Duration Contracts Issued by Insurance Companies.
The FASB board extended the effective dates of ASU No. 2018-12, Financial Services-Insurance (Topic 944) – Targeted Improvements to the Accounting for Long-Duration Contracts Issued by Insurance Companies. The promulgation directly impacts those insurance companies that issue long-term life insurance, disability income, long-term care, and annuity contracts. The Board contacted various insurance companies in the process of implementation and received overwhelming suggestions to extend the enactment dates to achieve a higher quality product.
Private companies, not-for-profit organizations, and certain small public companies were also given delays on the effective dates for credit losses (CECL), leases, and hedging standards. See the chart below for the detailed dates by entity.