The impact of assumption changes refers to the effects of revisions to key assumptions used in measuring insurance contracts under IFRS 17—such as incidence rates, lapse rates, and expenses—which result in changes to estimates of future cash flows.
The part related to future insurance services is recognized as an adjustment to the contractual service margin (CSM).
As Comprehensive Equity (CE), one of Lifenet’s key management indicators, is defined as the sum of “IFRS equity + CSM (after tax adjustments) + group credit life contract value,” an increase in the CSM due to favorable assumption changes will contribute to an increase in Comprehensive Equity (CE) through the corresponding increase in CSM (after tax adjustments).