Insured benefits

Learning objectives

• Identify a plan that includes insured benefits.L2
• Analyse the effect of an insurance contract on the classification of a plan from the facts of a case.L3

Normative references

• IAS 19 §46A plan funded through insurance premiums is treated as a defined contribution plan, unless the entity retains, directly or through the plan, a legal or constructive obligation to pay the employee benefits directly when they fall due or to pay further amounts if the insurer does not pay all the benefits; in that case it is treated as a defined benefit plan.

Original summaries of the paragraphs (reference register), never a quotation of the standard.

1 question

• Rovane SA has taken out a group insurance policy that funds its employees' pensions. The policy covers only pensions already earned; Rovane has committed to employees to pay itself any pension the insurer would not cover (case facts). Which analysis is consistent with the treatment of insured benefits?L2