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FASB issues proposal to delay long-duration contracts standard for insurers

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FASB issues proposal to delay long-duration contracts standard for insurers

The Financial Accounting Standards Board has issued a proposal that will delay the effective date on a standard that deals with long-duration contracts.

All insurance companies that issue long-duration contracts, including life insurance and annuities, will have additional time to apply a standard that is intended to "improve, simplify and enhance the financial reporting requirements," for long-duration contracts, according to a press release.

SEC filers will now have until January 2022 to apply the standard, a one-year extension, while so-called Smaller Reporting Companies and all other public business entities will have until January 2024, an extra three years. Any insurers that do not fall into these categories will also have until January 2024 to apply the standard, equating to a two-year extension for those companies.

FASB had voted in July to create a delay proposal but formally announced the delay Aug. 21. The board requested public comments on the proposal be sent by Sept. 20.