Comparison of the insurance liability for a life insurance contract under the Solvency II and IFRS 17 valuation methodologies

The thesis compares the Solvency II standard, which focuses on sufficient capital adequacy of an insurance company, and the new international accounting standard IFRS 17 Insurance Contracts, which requires consistency of accounting practices. The IFRS 17 Insurance Contracts was issued in May 2017 and its effectiveness is currently postponed to the beginning of 2023. The reason stems from its difficult implementation and not clearly defined implementation principles, which we will discuss in detail in the thesis. Although at first sight it may seem that the standards have different objectives and there is no reason to compare them, the opposite is true. Insurance companies often rely on the already established Solvency II liability valuation procedures for one of their most important activities, the valuation of insurance liabilities for IFRS 17 purposes. However, these are not identical approaches; both standards work with their own principles and methodologies for valuing insurance contract liabilities, the calculation and subsequent comparison of which is the main task of the thesis.