IFRS 17 - Insurance Contracts 57-59: Onerous groups and the liability for incurred claims under the premium allocation approach

What does 57-59 require?

If, at any point in the coverage period, facts and circumstances suggest that a group is onerous, the entity sets the paragraph 55 LRC against the fulfilment cash flows for the remaining coverage (paragraphs 33 to 37 and B36 to B92, with no time-value adjustment where the entity does not discount the LIC under 59(b)); any excess is recognised as a loss and added to the liability. Under the PAA, acquisition cash flows may be expensed when incurred if, at initial recognition, every contract in the group covers a year or less. The LIC equals the fulfilment cash flows attributable to claims already incurred, with no adjustment for time value and financial risk where payment is expected within a year of the claim arising.