Impact of IFRS 17 changes
3
IFRS 17 defers profitability of Asia Variable Universal Life (VUL)
product, creating earnings (and equity) impact at transition
Earnings recognition of Asia VUL product under IFRS 4 & IFRS 17
(Illustrative; not to scale)
Lifetime profit is the same under IFRS 4 & IFRS 17
IFRS 4
IFRS 17
•
VUL is an investment-linked insurance product with
recurring fees that are higher in the first few years and
then decrease to a lower level for the remaining years
Higher early year fees of VUL product will now amortize
evenly over the life of the policy
High growth of VUL product over last few years results
in higher deferral of earnings relative to CSM
amortization
Year 1
Year 2
Year 3
Year 4 Year 5
Year 6
Year 7 Year 8
Year 9
... Year X
SUN
LIFE
I FR S 1 7
•
MAY
2022 Note: This slide contains forward-looking statements. Refer to "Forward-looking statements" on slide 3 for more information 18View entire presentation