US GAAP Targeted Improvements & Disability Income Insurance

The changes to the measurement and reporting of long-duration insurance contracts will have a profound impact on the emergence and volatility of earnings under US GAAP. In this paper, Milliman’s Francois Dauphin, William Hines, and Dan Skwire illustrate the potential impacts of Accounting Standards Updates 2018-12, Targeted Improvements for Long-Duration Contracts, relative to current US GAAP accounting with respect to products with long claim periods such as individual disability insurance and highlights some practical implementation challenges.

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