Recently Issued Accounting Standards |
6 Months Ended | ||
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Jun. 30, 2025 | |||
| Recently Issued Accounting Standards [Abstract] | |||
| Recently Issued Accounting Standards |
Future Adoption of New Accounting Standards
Accounting for Long-Duration Contracts. In August 2018, the FASB issued ASU No. 2018-12, Financial Services —Insurance (Topic 944): Targeted Improvements to the Accounting for Long-Duration Contracts (“ASU 2018-12”). This guidance (1) improves the timeliness of recognizing
changes in the liability for future policy benefits and modifies the rate used to discount future cash flows, by updating the assumptions used in measuring the liability for future policy benefits for these contracts at least annually rather than
establishing them at contract inception and retaining them over the life of the contracts, which will improve the timeliness of recognizing changes in the liability that are caused by deviations in experience from the assumptions, and these
deviations will be recognized and reflected in the liability for future benefits as they occur, (2) improves the accounting for certain market-based options or guarantees associated with deposit (or account balance) contracts, (3) simplifies the
amortization of deferred acquisition costs; amortization on a constant level basis will be used in place of a complex actuarial methodology that is in place under existing financial reporting standards, and (4) improves the effectiveness of the
required disclosures, with additional disclosures required, including disaggregated rollforwards of deferred acquisition costs, liabilities for future policy benefits, market risk benefits and liability for policyholders’ account balances. ASU
2018-12 is effective for annual reporting periods beginning after December 15, 2024 and interim periods beginning after December 15, 2025, although earlier adoption is permitted. The Company has completed the development of the necessary
actuarial models for the affected policies and is in the process of testing the models and developing procedures that are responsive to support the new valuation requirements that will be used to estimate the liability for future benefits for
these policies. The Company expects its Life, Medicare supplement and certain individual Accident and Health products to fall within the scope of this standard. The Company has elected to use the modified retrospective method upon adoption. The
disclosures under ASU 2018-12 will change significantly, and the impact on our consolidated financial statements is expected to be material.
For more information regarding accounting standards that the Company has not yet adopted, see the “Recently Issued Accounting Standards - Future Adoption of New Accounting Standards” section of Note
1 of Notes to Consolidated Financial Statements in the 2024 Annual Report.
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