FASB 60

  1. Short duration ins contract
    • Most P/C contracts, term life ins pol
    • Can cancel pol, revice P, adjust provisions at renewal
    • Premiums are usually earned evenly over pol period
    • Liability for unpaid clms and LAE accrued when event occur
  2. Long duration ins contract
    • Most life insurance contracts, annuity contracts
    • Generally not subject to changes in provisions
    • Premium generally level troughout
    • Liabilities are accrued over current and expected renewal periods
  3. Premium deficiency
    • Recognized is sum of expected clm costs and LAE, expected dividends to PH, unarmortized acquisition costs, and maintenance costs exceeds related unearned prem
    • Charge any unamortized acquisition cost
Author
Esaie
ID
34015
Card Set
FASB 60
Description
Exam6 by Esaie FASB 60
Updated