Wednesday, October 1st, 2025
In the News · IFRS 17 · Actuarial Practice · Research
An in-depth analysis of IFRS 17 discount rate methodology — authored by Shasat’s Michael Winkler and Sunil Kansal — has been selected for publication by the Actuaries Institute of Australia as part of its research and analysis series.
Shasat Consulting | Michael Winkler & Sunil Kansal | March 2026
We are pleased to announce that our research article, IFRS 17 Discounting and Market Complexities, has been published by the Actuaries Institute of Australia as part of its Research & Analysis series. The article was authored by Michael Winkler, Actuary (SAA/DAV) at Shasat Consulting, and Sunil Kansal, Head of Consulting at Shasat.
The publication addresses one of the most consequential and least straightforward aspects of IFRS 17 implementation — how to derive appropriate discount rates for insurance contract liabilities. Drawing on analysis of 2024 annual reports from leading global insurers including Aviva, Generali, AXA, Allianz, Aegon, Sun Life, Prudential, and Manulife, the article provides both technical depth and practical market perspective.
|
The Article Covers · The top-down and bottom-up approaches to setting IFRS 17 discount rates and how they compare to Solvency II · Practical challenges including duration mismatches, currency mismatches, and liquidity premium estimation · How to construct the discount curve beyond the last observable market point · The OCI versus P&L accounting policy election and its implications · Challenges specific to developing markets where observable risk-free rates are unavailable · Market observations from 2024 insurer disclosures across EUR and USD rate environments |
The article highlights that while most insurers have adopted the bottom-up approach — closely aligned with the Solvency II Volatility Adjustment — practice varies significantly across companies and jurisdictions. Decisions around discount rate methodology, liquidity premium calibration, and the OCI election have material consequences for reported liabilities and earnings volatility.
|
“We would highly recommend analysing the quantitative impact of any simplifications at the earliest possible stage — before they become embedded in reporting processes and create downstream compliance and restatement risk.” — Michael Winkler & Sunil Kansal |
The research builds on the authors’ broader work on IFRS 17, including their book Navigating IFRS 17: A Practical Guide to Accounting & Actuarial Implementation, and reflects Shasat’s ongoing commitment to producing technically rigorous, practice-oriented insight for the global insurance and actuarial community.
|
Read the Full Article Published by the Actuaries Institute of Australia — Research & Analysis Series |
|
Michael Winkler Actuary (SAA/DAV) at Shasat Consulting. Previously in leading actuarial positions at Swiss Re, Munich Re/New Re, and Winterthur Group. |
Sunil Kansal Head of Consulting at Shasat. Chartered Accountant and Fellow of the Institute of Chartered Accountants in England and Wales (ICAEW). |
Tags: IFRS 17 · Discounting · Solvency II · Actuaries Institute of Australia · Insurance Liabilities · Liquidity Premium · OCI Election · Shasat Research
