Portfolios of contracts

Learning objectives

• Explain that a portfolio comprises contracts subject to similar risks and managed together.L1
• Form an insurer's portfolios from given product lines and justify the allocation.L2

Normative references

• IFRS 17 §14An entity identifies portfolios of insurance contracts: contracts subject to similar risks and managed together.

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

2 questions

• An insurer places in a single portfolio contracts exposed to very different risks, on the ground that they are managed together by the same department; this construction of the portfolio complies with IFRS 17.L1
• Axiome SA manages in a single team two ranges of motor third-party liability contracts whose risks are judged similar, and a range of death cover contracts whose risks differ (case assumptions). Which grouping into portfolios complies with the rule?L2