Page 166 - IC46 addendum

Insurance Contracts

if the insured person dies contracts that all transfer insurance
before then. risk, the insurer may classify the
entire book as insurance contracts
without examining each contract to
identify a few non-derivative pure
endowments that transfer
insignificant insurance risk (see
paragraph B25).

1.6 Deferred annuity: policyholder Insurance contract (unless the

will receive, or can elect transfer of insurance risk is

to receive, a life-contingent insignificant). The contract transfers

annuity at rates guaranteed mortality risk to the insurer at

at inception. inception, because the insurer might

have to pay significant additional

benefits for an individual contract if

the annuitant elects to take the life-

contingent annuity and survives

longer than expected (unless the

contingent amount is insignificant in

all scenarios that have commercial

substance).

1.7 Deferred annuity: policyholder Not an insurance contract at

will receive, or can elect to inception, if the insurer can reprice

receive, a life-contingent the mortality risk without constraints.

annuity at rates prevailing Within the scope ofInd AS 39
when the annuity begins. Financial Instruments: Recognition

and Measurement unless the
contract contains a discretionary
participation feature.

Will become an insurance contract
when the annuity rate is fixed
(unless the contingent amount is
insignificant in all scenarios that
have commercial substance).

1.8 Investment contract(a) that Within the scope of Ind AS 39.
does not contain a
discretionary participation
feature.

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