v3.24.1.1.u2
Insurance
 6 Months Ended
Apr. 30, 2024
Insurance [Abstract]  
Insurance
NOTE 14: INSURANCE
INSURANCE SERVICE RESULT
Insurance revenue and expenses are presented
 
on the Interim Consolidated Statement
 
of Income under Insurance revenue and Insurance
 
service expenses,
respectively. Net income or expense from reinsurance is presented
 
in other income (loss).
The following table presents components of the
 
insurance service result
presented on the Interim Consolidated Statement
 
of Income for the Bank which includes
 
the results of property and casualty insurance,
 
life and health insurance,
as well as reinsurance issued and held in
 
Canada and internationally.
Insurance Service Result
(millions of Canadian dollars)
For the three months ended
For the six months ended
April 30, 2024
April 30, 2023
April 30, 2024
April 30, 2023
Insurance revenue
$
1,665
$
1,514
$
3,341
$
3,056
Insurance service expenses
1,248
1,118
2,614
2,282
Insurance service result before reinsurance
 
contracts held
 
417
396
 
727
774
Net income (expense) from reinsurance
 
contracts held
(31)
(38)
(19)
(84)
Insurance service result
$
386
$
358
$
708
$
690
For the three and six months ended April
 
30, 2024, the Bank recognized insurance
 
finance expenses of $
58
 
million and $
180
 
million, respectively (three and six
months ended April 30, 2023 – $
59
 
million and $
184
 
million, respectively), from insurance and
 
reinsurance contracts in other income
 
(loss). The Bank’s investment
return on securities supporting insurance
 
contracts is comprised of interest income reported
 
in net interest income and fair value changes
 
reported in other income
(loss). Investment return on securities supporting
 
insurance contracts was $
35
 
million and $
163
 
million, respectively, for the three and six months ended
April 30, 2024 (three and six months ended
 
April 30, 2023 – $
56
 
million and $
206
 
million, respectively).
INSURANCE CONTRACT LIABILITIES
 
Insurance contract liabilities are comprised
 
of amounts related to the LRC, LIC and
 
other insurance liabilities.
 
The following table presents LRC and LIC balances
 
for property and casualty insurance contracts.
Property and casualty insurance contract liabilities by
 
LRC and LIC
(millions of Canadian dollars)
As at
April 30, 2024
April 30, 2023
Liability for
Liability for
Liability for
Liability for
remaining coverage
incurred claims
Total
remaining coverage
incurred claims
Total
Estimates
Estimates
of the
of the
 
 
present
 
 
 
present
 
Excluding
value of
Excluding
value of
loss
Loss
future
Risk
loss
Loss
future
Risk
component
component
cash flows
adjustment
component
component
cash flows
adjustment
Balance at beginning of period
Insurance contract liabilities
$
630
$
129
$
4,740
$
220
$
5,719
$
623
$
113
$
4,700
$
208
$
5,644
Balance at end of period
Insurance contract liabilities
$
630
$
119
$
4,723
$
220
$
5,692
$
551
$
130
$
4,608
$
206
$
5,495
For property and casualty contracts,
 
during the three and six months ended April
 
30, 2024, the Bank recognized insurance
 
revenue of $
1,305
 
million and
$
2,631
 
million, respectively (three and six months
 
ended April 30, 2023 – $
1,170
 
million and $
2,358
 
million, respectively), insurance service expenses
 
of
$
1,033
 
million and $
2,204
 
million, respectively (three and six months ended
 
April 30, 2023 – $
925
 
million and $
1,903
 
million, respectively), and insurance finance
expenses of $
77
 
million and $
198
 
million, respectively (three and six months ended
 
April 30, 2023 – $
79
 
million and $
200
 
million, respectively).
Other insurance liabilities were $
132
 
million as at April 30, 2024 (October 31, 2023 –
 
$
127
 
million) and include life and health insurance
 
contract liabilities of
$
112
 
million (October 31, 2023 – $
124
 
million).
RISK ADJUSTMENT FOR NON-FINANCIAL
 
RISK AND DISCOUNTING
The risk adjustment reflects an amount that
 
an insurer would rationally pay to remove
 
the uncertainty that future cash flows
 
will exceed the expected value amount.
The Bank has estimated the risk adjustment
 
for its property and casualty operations’
 
LIC using statistical techniques in accordance
 
with Canadian accepted
actuarial principles to develop potential future observations
 
and a confidence level of 90th percentile.
Insurance contract liabilities are calculated
 
by discounting expected future cash flows.
 
The interest rates used to discount the Bank’s
 
insurance balances over a
duration of
1
 
to
10 years
 
range from
5.3
% to
4.9
% as at April 30, 2024 (October 31, 2023 –
5.7
% to
5.5
%).