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Accounting Alert

Discount Rates for Life and Non-life Insurance Policy Reserves and Reserves for Long-Term Contracts of Health Maintenance Organizations (HMO)

Background

The Insurance Commission in its Circular Letter No. 2024-17, has issued the schedules of Peso and Dollar Spot and Forward rates as of September 30, 2024.  These rates shall be used in discounting cash flows in the calculation of life and non-life insurance policy reserves for long term contracts of HMOs as of September 30, 2024
 
The Peso and Dollar spot and forward rates to be used for discounting cash flows with duration of more than 20 years were determined using the 1-year moving-average of the 20-year government bond yield rate.
                   
Please see attached article for further information.

IC Circular Letter No. 2024-17

IC Circular Letter No. 2024-17

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