Requirements for the Valuation and Structure of Insurance Liabilities in Accordance with IFRS (Resolution No. 84)

Reference card for a regulatory legal act. The full text is available in the official «Adilet» system (adilet.zan.kz).

Requisites

Parameter	Value
Type of act	Resolution of the Board of the Agency of the RK for Regulation and Development of the Financial Market (ARDFM)
Number and date	No. 84 of 26 December 2025
Status	In force (as of June 2026)
Official code	V2500037733

Subject of the document

It establishes the requirements for the valuation and structure of insurance liabilities in accordance with IFRS. It defines the composition and procedure of the actuarial calculation of liabilities, including the measurement components under IFRS 17 and the formats of the corresponding calculation tables.

Relevance for actuarial practice

It is one of the key acts for the actuarial valuation of reserves and liabilities: the best estimate of cash flows, discounting, and the risk adjustment.
The calculation tables under this act are appended to the mandatory actuarial opinion (see card No. 191).
It is the subject of the Chamber's initiatives on the mandatory scope of independent reserve review (full recalculation, retrospective run-off analysis).

Official source

Full text in force: adilet.zan.kz/rus/docs/V2500037733. Files in the repository: docs/Law/84.pdf, docs/Law/84.docx.

English Translation (Auto-generated)

Official source: Adilet / https://adilet.zan.kz/rus/docs/V2500037733 The relevance of the editorial office has been verified: 2026-06-20.

Note IZPI! For the procedure for putting this order into effect, see clause 4.

In accordance with paragraph 2 of Article 47-1 of the Law of the Republic of Kazakhstan “On Insurance Activities” and subparagraph 2-1) of Article 11 of the Law of the Republic of Kazakhstan “On State Regulation, Control and Supervision of the Financial Market and Financial Organizations”, the Board of the Agency of the Republic of Kazakhstan for Regulation and Development of the Financial Market DECIDES:

Approve the attached:

Requirements for the assessment and structure of insurance liabilities in accordance with international financial reporting standards;

2) Requirements for automation of assessment of insurance obligations;

3) Requirements for the methodology for assessing insurance liabilities;

4) Requirements for the procedure and timing of approval of the methodology for assessing insurance liabilities.

2. The Department of the Insurance Market and Actuarial Calculations, in accordance with the procedure established by the legislation of the Republic of Kazakhstan, shall ensure:

jointly with the Legal Department, state registration of this resolution with the Ministry of Justice of the Republic of Kazakhstan;

2) placement of this resolution on the official Internet resource of the Agency of the Republic of Kazakhstan for Regulation and Development of the Financial Market after its official publication;

3) within ten working days after the state registration of this resolution, submission to the Legal Department of information on the implementation of the event provided for in subparagraph 2) of this paragraph.

3. Control over the implementation of this resolution shall be assigned to the supervising Deputy Chairman of the Agency of the Republic of Kazakhstan for Regulation and Development of the Financial Market.

4. This resolution comes into force on January 1, 2026, with the exception of subparagraph 2) of paragraph 1 of this resolution, which comes into force on January 1, 2027.

Chairman of the Agency of the Republic of Kazakhstan for Regulation and Development of the Financial Market M. Abylkasymova

Approved by Resolution of the Board of the Agency of the Republic of Kazakhstan for Regulation and Development of the Financial Market dated December 26, 2025 No. 84

Requirements for the assessment and structure of insurance liabilities in accordance with international financial reporting standards

Chapter 1. General provisions

These Requirements for the assessment and structure of insurance liabilities in accordance with international financial reporting standards (hereinafter referred to as the Requirements) were developed in accordance with paragraph 2 of Article 47-1 of the Law of the Republic of Kazakhstan “On Insurance Activities” (hereinafter referred to as the Law) and subparagraph 2-1) of Article 11 of the Law of the Republic of Kazakhstan “On State Regulation, Control and Supervision of the Financial Market and Financial Organizations” and establish requirements for the assessment and structure of insurance liabilities in accordance with international financial reporting standards.

2. The requirements apply to insurance (reinsurance) organizations, including Islamic insurance (reinsurance) organizations, branches of non-resident insurance organizations of the Republic of Kazakhstan and branches of non-resident Islamic insurance organizations of the Republic of Kazakhstan.

3. The following concepts are used in the Requirements:

acquisition cash flows – cash flows caused by the costs of selling, underwriting and concluding a group of insurance contracts that are directly related to the portfolio of insurance contracts to which this group belongs. Such cash flows include cash flows that cannot be directly attributed to individual contracts or groups of insurance contracts in the portfolio;

2) actuarial methods - economic and mathematical calculation methods used by the actuary when calculating insurance liabilities;

3) actuarial assumptions - quantitative and qualitative assumptions used by the actuary in assessing insurance liabilities, including forecasts regarding insurance payments, frequency and size of losses, dynamics of insurance premiums, behavior of policyholders, level of expenses, interest rates, financial and economic parameters;

4) onerous insurance contracts - insurance contracts for which, as of the date of initial recognition, cash flows for the fulfillment of contracts allocated to these contracts, previously recognized acquisition cash flows and cash flows arising under these contracts as of the date of initial recognition, in their totality represent a net outflow of funds;

5) projected payments - obligations of the insurance (reinsurance) company related to the extension (re-examination) of the degree of loss of professional ability (hereinafter - the degree of loss of professional ability) of the beneficiary or compensation for damage to persons who suffered damage as a result of the death of an employee in accordance with Article 940 of the Civil Code of the Republic of Kazakhstan (Special Part) (hereinafter - the Civil Code);

6) aggregation – grouping of insurance contracts for assessment, accounting and presentation of insurance liabilities;

7) discount rate curve - a sequence of interest rates reflecting the time value of money for various periods, used to bring future cash flows to the current value;

8) settlement date – the date on which insurance liabilities are calculated;

9) incurred losses - the amount of payments made and declared but unresolved losses of the insurance (reinsurance) company;

10) the reinsurer’s share in insurance liabilities is the assets or liabilities of the insurance (reinsurance) company arising from reinsurance contracts, estimated on the basis of actuarial calculations as of the date of calculation;

11) non-financial risk – risks not related to financial risks;

12) risk adjustment for non-financial risk (hereinafter referred to as the risk adjustment) - compensation required for accepting uncertainty regarding the amount and timing of cash flows that arise as a result of non-financial risk as insurance contracts are executed;

13) financial risk – the risk of a possible future change in one or more certain factors: interest rate, price of a financial instrument, exchange rate, price index, credit rating or other variable, provided for a non-financial variable that this variable is not specific to one of the parties to the insurance (reinsurance) agreement;

14) declared but unresolved loss - a requirement to the insurance (reinsurance) company about the occurrence of an insured event and (or) an insured event and (or) about the implementation of an insurance payment, declared by the insured (insured, beneficiary) in writing, or in the manner prescribed by the laws of the Republic of Kazakhstan on compulsory types of insurance and (or) an insurance (reinsurance) agreement under which the insurance payment was not made or was not implemented in full;

15) cash flows under the insurance (reinsurance) contract - expected incoming and outgoing cash flows arising from the rights and obligations of the insurance (reinsurance) company existing at the reporting date and directly related to the fulfillment of the terms of the current insurance (reinsurance) contract during its validity period;

16) insurance liabilities – obligations of an insurance (reinsurance) company under insurance (reinsurance) contracts, estimated on the basis of actuarial calculations as of the date of calculation;

17) insured event - an event that has a likelihood of subsequently being recognized as an insured event under an insurance (reinsurance) agreement;

18) liabilities for the remaining part of insurance coverage - an assessment of insurance liabilities associated with future insurance events that may occur during the remaining term of existing insurance contracts, less expected future revenues under these contracts;

19) insurance proceeds - an amount representing the recognized income of an insurance (reinsurance) organization for insurance services provided within a group of insurance contracts, reflecting the organization’s right to receive compensation in exchange for the provision of such services;

20) portfolio of insurance contracts - a set of insurance contracts united on the basis of homogeneity of insurance risk and managed jointly;

21) group of insurance contracts - a set of insurance contracts, separated as a result of dividing the portfolio of insurance contracts, at least into contracts that were concluded during a period not exceeding one year, and which, upon initial recognition:

are burdensome;

are characterized by no significant likelihood that they will subsequently become burdensome;

insurance contracts not related to the above two groups;

22) expenses for settlement of insurance losses - the amount of expenses of an insurance (reinsurance) company incurred to pay for expert, consulting or other services related to assessing the amount and reducing damage (harm) caused to the property interests of the insured that arose in connection with insured events;

23) segmentation – division of insurance contracts into portfolios, loss groups and annual cohorts to ensure correct assessment;

24) liabilities for incurred insurance losses - assessment of insurance liabilities arising in connection with insured events that have already occurred, but for which insurance payments have not yet been made in full or in part;

25) authorized body - an authorized body for regulation, control and supervision of the financial market and financial organizations;

26) margin for services provided for in the contract - a component of the book value of an asset or liability for a group of insurance contracts, representing unearned profit that the insurance (reinsurance) organization will recognize as the services provided for in the insurance (reinsurance) contracts in this group are provided;

27) loss component - part of the liability for the remaining part of the insurance coverage, which represents the excess of expected cash outflows over expected inflows under an onerous contract;

28) the cost allocation process is a systematic method of distributing indirect costs that are not directly attributable to insurance contracts by type of expense and groups of insurance contracts in order to ensure accurate and reasonable reflection of costs as part of insurance liabilities;

29) large loss - a loss under insurance (reinsurance) contracts, the amount of which significantly exceeds the average level of losses for the corresponding group or portfolio of insurance contracts.

Chapter 2. Requirements for assessing insurance liabilities in accordance with international financial reporting standards

4. Insurance obligations are created in accordance with International Financial Reporting Standard 17 “Insurance Contracts” and the requirements of the legislation of the Republic of Kazakhstan on accounting and financial reporting.

5. The actuary calculates insurance liabilities based on the information contained in the statements of the insurance (reinsurance) company and other information specified in the Methodology for assessing insurance liabilities, approved by the executive body of the insurance (reinsurance) organization (hereinafter referred to as the Methodology for assessing insurance liabilities).

6. The actuary, no later than the 12th (twelfth) working day of the month following the reporting quarter, draws up on paper in any form a justification for the assessment of insurance liabilities with a detailed description of the assumptions used in their assessment, which is signed by the actuary and stored in the insurance (reinsurance) organization.

The list and procedure for applying actuarial assumptions are established by the Methodology for assessing insurance liabilities.

7. The actuary, no later than 31 (thirty-first) May (inclusive) of the year following the reporting year, draws up on paper a justification for the assessment of insurance liabilities, including calculations of indicators in accordance with the requirements of the Tax Code, subject to actuarial assessment, with a detailed description of the assumptions used in their assessment, which is signed by the actuary and stored in the insurance (reinsurance) organization.

8. Insurance liabilities calculated by the actuary are formed separately for each group of insurance (reinsurance) contracts. The calculation of insurance liabilities is carried out taking into account the volume of obligations assumed by the organization under all concluded insurance contracts, regardless of subsequent reinsurance of risks.

9. Insurance obligations under a group of insurance (reinsurance) contracts are assessed by a general valuation model and (or) a method based on the distribution of the insurance premium.

10. The premium allocation method may be used by an actuary to estimate insurance liabilities if one of the following conditions is met:

a group of insurance contracts consists of contracts, the period of insurance coverage for each of which is one year or less;

2) application of the method based on the distribution of the insurance premium for a group of insurance contracts will give the result of assessing liabilities for the remaining part of the coverage, which does not differ significantly from the result obtained when applying the general assessment model, no more than 10% up or down.

11. Cash flows from subrogations, recourses and from the sale of useful balances are taken into account in the cash flow forecast separately and cannot be mixed with other cash flows.

Chapter 3. Aggregation, segmentation of insurance contracts

12. The insurance (reinsurance) organization identifies portfolios of insurance contracts, united on the basis of homogeneity of insurance risk and managed jointly. Insurance contracts characterized by heterogeneous risks should be included in different portfolios.

13. Portfolios of insurance contracts are classified according to insurance classes. It is allowed to classify a portfolio of insurance contracts based on the homogeneity of insurance risks. The classification of the portfolio of contracts, other than the classification by insurance class, must be determined by the Methodology for calculating insurance liabilities, indicating the rationale for its application.

14. Insurance contracts included in one portfolio of insurance contracts are grouped upon initial recognition according to the following characteristics:

onerous insurance contracts;

2) insurance contracts for which, at the date of initial recognition, there is no significant likelihood that they will subsequently become onerous;

3) insurance contracts not related to the above two groups.

15. The composition of groups of contracts created upon initial recognition is not subsequently revised.

16. Insurance contracts concluded with a difference of more than one year are not included in the same group, with the exception of additional agreements to these insurance contracts. Insurance contracts that are issued within one calendar year constitute an annual group.

17. The division of groups of insurance contracts into subgroups is allowed in the cases and in the manner provided for by the Methodology for assessing insurance liabilities.

18. To determine the onerousness of insurance contracts, the insurance (reinsurance) organization conducts an onerousness test in accordance with the Methodology for assessing insurance obligations.

Chapter 4. Structure of insurance obligations

19. Insurance obligations required to be formed by an insurance (reinsurance) company include:

obligations for the remaining part of the insurance coverage;

2) obligations for incurred insurance losses.

Chapter 5. Initial assessment of insurance liabilities using the general assessment model

20. Upon initial recognition, insurance liabilities for a group of insurance contracts using the general valuation model are estimated as the sum of:

cash flows for the implementation of insurance contracts, consisting of the following components:

estimates of future cash flows under insurance contracts that will arise as the terms of the insurance contracts are fulfilled;

adjustments to reflect the time value of money and financial risks associated with future cash flows, determined using the discount rate established by the Insurance Liability Valuation Methodology;

risk adjustment for non-financial risk;

2) margin for the services provided for in the contract.

21. Cash flows include all inflows and outflows of funds directly related to the fulfillment of obligations under a group of insurance contracts and are accounted for on a monthly basis or at a frequency expressly established by the terms of the relevant insurance contract.

22. Cash flows include direct and indirect costs associated with the execution of insurance contracts.

23. Indirect settlement costs and indirect administrative costs, taken into account as part of the cash flows for the execution of contracts, are part of the administrative costs of the insurance (reinsurance) company, which cannot be directly attributed to a specific insurance contract. For these expenses, the process of allocating expenses by type of expense and by groups of insurance contracts is applied in accordance with the Methodology for assessing insurance liabilities.

24. Upon initial recognition of a group of insurance contracts, the actuary determines the discount rate curve in accordance with the Methodology for Valuation of Insurance Liabilities.

The discount rate curve can be determined either on the basis of market yields of financial instruments or by constructing it taking into account the characteristics of the liabilities, with possible adjustment for an illiquidity premium.

The discount rate curve determined at the date of initial recognition of a group of insurance contracts is subject to monthly updating when new contracts are added to the group.

25. The margin for contractual services at initial recognition reflects the expected profit associated with the fulfillment of obligations under a group of insurance contracts and is defined as the excess of the expected present value of cash inflows over cash outflows, taking into account risk adjustment.

Margin for contractual services is amortized over the coverage period for a group of insurance contracts based on units of coverage determined in accordance with the Insurance Liability Valuation Methodology.

The number of units of insurance coverage in a group represents the maximum amount of liability provided under the contracts included in this group, which is determined based on an analysis for each contract of the amount of benefits provided under the contract and the expected duration of insurance coverage.

26. If a group of insurance contracts is recognized as onerous, the margin for the services provided for in the contract is 0 (zero). At the same time, as part of the liabilities for the remaining part of the insurance coverage, a loss component is formed, the calculation procedure of which is determined in accordance with the Methodology for assessing insurance liabilities.

The loss component is recognized in profit or loss and is not included in insurance proceeds.

Chapter 6. Subsequent valuation of insurance liabilities using the general valuation model

27. When subsequently assessing insurance liabilities, insurance liabilities include liabilities for the remaining part of the insurance coverage and liabilities for incurred insured losses.

28. After initial recognition, the actuary remeasures the insurance liability for the remaining insurance coverage at each reporting date as:

cash flows for the execution of contracts that relate to the insurance coverage that will be provided under the contract in future periods;

2) the margin for the services provided for in the contract, estimated at the reporting date.

29. The estimate of insurance liabilities for the remaining insurance coverage is reviewed at each reporting date in accordance with current best estimate assumptions.

30. The selection of tables containing the probabilities of death, disability, illness of individuals and values calculated on their basis associated with the upcoming life expectancy of individuals is made taking into account the characteristics of the insurance risk of the portfolio or for a group of insurance contracts, as well as based on the characteristics of the insured and (or) policyholders.

31. For groups of insurance contracts containing pension annuity contracts, the following indicators are used:

concluded before July 1, 2017, indicators are used that do not exceed the mortality rates of individuals to calculate insurance payments under a pension annuity contract in accordance with the Requirements for the formation, methodology for calculating insurance reserves and their structure, approved by Resolution of the Board of the National Bank of the Republic of Kazakhstan dated January 31, 2019 No. 13 “On approval of the Requirements for the formation, methodology for calculating insurance reserves and their structure” (registered in Register of state registration of normative legal acts under No. 18290);

concluded after July 1, 2017, indicators are used that do not exceed the mortality rates of individuals for calculating insurance payments under a pension annuity agreement, specified in Appendix 2 to the Methodology for calculating the insurance premium and insurance payment under a pension annuity agreement, approved by the Resolution of the Board of the Agency of the Republic of Kazakhstan for Regulation and Development of the Financial Market dated June 7, 2023 No. 45 “On approval of a standard pension annuity agreement, establishment Methods for calculating the insurance premium and insurance payment from an insurance organization under a pension annuity agreement, the permissible level of expenses of the insurance organization for conducting business under concluded pension annuity agreements, as well as the indexation rate of the insurance payment" (registered in the Register of State Registration of Normative Legal Acts under No. 32831).

32. The margin for the services provided for in the contract as of the reporting date is determined taking into account the following changes that occurred during the reporting period:

an increase in the amount of margin relating to contracts included in the group of insurance contracts during the reporting period;

2) an increase in the amount of interest accrued on the margin using the discount rate determined on the date of initial recognition of the group of contracts;

3) an increase or decrease as a result of a change in the estimate of future expected cash flows related to the remaining services;

4) increase or decrease by the amount of exchange rate differences arising during the recalculation of liabilities denominated in foreign currency;

5) reduction by the amount recognized as insurance revenue in connection with the provision of insurance services during the reporting period.

33. The discount rate used for discounting cash flows reflects the characteristics of cash flows arising from groups of insurance contracts, such as timing, currency and liquidity of cash flows and are determined in accordance with the Methodology for Valuation of Insurance Liabilities.

34. The liability for incurred insured losses includes:

liability for declared but unresolved losses (hereinafter referred to as OLL) - an assessment of the insurance (reinsurance) company’s obligations to make insurance payments, unfulfilled or not fully fulfilled as of the reporting date, including expenses for settling losses;

2) liability for occurred but unreported losses (hereinafter referred to as LRNU) - an assessment of the obligations of the insurance (reinsurance) company to make insurance payments, including the costs of settling losses arising in connection with insured events that occurred in the reporting or preceding periods, the occurrence of which was not declared to the insurance (reinsurance) company in the reporting or preceding periods in the manner established by the law of the Republic of Kazakhstan or the contract;

3) risk adjustment.

35. OZNU is formed separately for each declared but unresolved loss, from the date of receipt of the application of the policyholder (the insured, the beneficiary) about the occurrence of an insured event and (or) an insured event and (or) about making an insurance payment, depending on which date comes earlier, until the date of making the insurance payment or making a decision to refuse to make an insurance payment by the insurer, or a written refusal of the policyholder (the insured, beneficiary) in receiving insurance payment, including consideration of an application for the occurrence of an insured event or insured event, depending on which date comes first.

In the absence of grounds for the formation of a declared but unresolved loss established by paragraph 40 of the Requirements, the insurance (reinsurance) organization writes off the written-off damages after 3 (three) years from the date of receipt of the application of the policyholder (insured, beneficiary) about the occurrence of an insured event and (or) an insured event and (or) about making an insurance payment.

36. OZNU for a declared but unresolved loss under a life insurance contract, under which a decision was made to make an insurance payment within a period of more than 3 (three) years from the date of such a decision and (or) from the date of receipt of an application from the policyholder (insured, beneficiary) about the occurrence of an insured event and (or) an insured event and (or) about making an insurance payment, depending on which date comes earlier, is formed before the date of implementation insurance payment in full.

37. OZNU is formed in the amount of the declared loss.

If the policyholder (insured, beneficiary) and the insurance (reinsurance) company do not have sufficient information about the amount of loss, the OPL is formed in an amount sufficient for insurance payment, but not less than the average value of paid claims made for a similar group of insured events for the previous financial year or the previous 2 (two) financial years, depending on which of the values is greater.

In the absence of sufficient information on paid claims made for a similar group of insured events for the previous financial year or the previous 2 (two) financial years, the OPL is formed in the amount of not less than the average market value of paid claims made for the class of insurance for the previous financial year or the previous 2 (two) financial years, depending on which value is greater.

The actuary, if necessary, makes an adjustment to the loss taken into account in calculating the average (market average) value of paid claims, which is large.

The criteria for classifying losses as major are established by the Methodology for assessing insurance liabilities.

The amounts of the OPL, formed due to the lack of sufficient information about the amount of the loss, are recalculated at the end of each financial year based on their sizes calculated in accordance with parts two and three of this paragraph.

If there are documents confirming the amount of the loss, or after the insurance (reinsurance) organization receives the specified documents, the OPL is formed in the amount of the declared and documented loss.

The total amount of OPL for portfolios of insurance contracts is determined by summing up the OPL formed for all declared but unresolved losses.

38. The amount of OZNU increases by the amount of estimated expenses directly related to the consideration and settlement of the amount of insurance payments for declared claims, calculated by the actuary.

39. The calculated amount of OZNU, if necessary, is reduced by the amount of overdue debt of the policyholder (reinsurer) for payment of the insurance premium (the next insurance premium) of the insurance (reinsurance) organization on the date of calculation (including the amount of debt under the annuity insurance agreement).

40. If legal proceedings have been initiated against an insurance (reinsurance) company on the issue of making insurance payments, the OZNU is formed in the manner established in paragraph 37 of the Requirements, during the period from the date of commencement of legal proceedings until the date the court decision on the issue of making insurance payments enters into legal force, but not earlier than the date of making the insurance payment.

41. Calculation of general taxation income is carried out using the following actuarial methods:

the chain ladder method without adjustment for inflation in accordance with the Calculation of liabilities for occurred but undeclared losses using the chain ladder method without adjusting for inflation in the form in accordance with Appendix 1 to these Requirements and adjusted for inflation in accordance with the Calculation of liabilities for occurred but unreported losses using the chain ladder method adjusted for inflation in the form in accordance with Appendix 2 hereto Requirements.

For the purposes of these Requirements, the chain ladder method refers to the method of distributing the insurer's obligations to make insurance payments for insured events that occurred in the reporting period or in periods preceding the reporting period.

In the chain ladder method, the distribution of the insurer's obligations is based on payments (paid losses) or incurred losses of the insurance (reinsurance) organization.

In the inflation-adjusted chain ladder method, payments (losses paid) or losses incurred are increased by the inflation rate;

2) the Bornhuetter-Ferguson method in accordance with the Calculation of liabilities of occurred but unreported losses using the Bornhuetter-Ferguson method in the form according to Appendix 3 to these Requirements.

The Bornhuetter-Ferguson method is based on the chain ladder method, the distribution of liabilities for which is based on payments (paid losses) or incurred losses, and determining the expected value of future losses.

The expected value of future losses is equal to the product of the earned premium and the loss ratio, the size of which is not less than the average value of loss ratios for policies calculated for completed financial years preceding the periods of losses, taken into account by the insurance (reinsurance) company when distributing liabilities in the form in accordance with Appendix 3 to these Requirements.

42. The loss ratio for policies is calculated as the ratio of the amount of losses incurred, including expenses for settling losses, under insurance (reinsurance) contracts that entered into force in the corresponding financial year to the earned insurance premiums under the specified insurance (reinsurance) contracts.

When calculating the loss ratio for policies, losses incurred, including loss adjustment expenses, and insurance premiums earned are taken into account for completed financial years up to the reporting date.

When calculating the loss ratio for policies used to calculate insurance liabilities, the actuary, if necessary, adjusts the loss under an insurance (reinsurance) contract that is large.

43. In the case of an actuary’s distribution of the insurer’s liabilities on the basis of incurred losses when calculating the general tax liability using actuarial methods, the table of accumulated losses for calculating liabilities for incurred but not reported losses using the chain ladder method without adjusting for inflation in the form in accordance with Appendix 1 to these Requirements is constructed by summing the reported but unresolved losses and the accumulated amounts of payments (paid losses) at the end of each occurrence period losses used to construct a triangle of accumulated losses, according to the Table of accumulated losses based on incurred losses. Distribution of liabilities of an insurance (reinsurance) company based on incurred losses in accordance with Appendix 4 to these Requirements.

In the case of distribution by the actuary of the insurer's obligations on the basis of incurred losses when calculating the general tax liability using actuarial methods, the table of accumulated losses adjusted for inflation for past periods. Calculation of obligations for incurred but not reported losses using the chain ladder method adjusted for inflation in the form in accordance with Appendix 1 to these Requirements is constructed by summing the declared but unresolved losses and accumulated amounts of payments (paid losses) at the end of each loss period used to construct a triangle of accumulated losses, according to the Table of accumulated losses based on incurred losses. Distribution of liabilities of an insurance (reinsurance) company based on incurred losses in accordance with Appendix 4 to these Requirements.

In the case of an actuary's distribution of the insurer's liabilities based on incurred losses when calculating the general tax liability using actuarial methods, the table of accumulated losses for calculating liabilities for incurred but not reported losses using the Bornhuetter-Ferguson method in the form according to Appendix 3 to these Requirements is constructed by summing the declared but unresolved losses and the accumulated amounts of payments (paid losses) at the end of each loss period used to construct a triangle of accumulated losses, according to the Table of accumulated losses based on losses incurred. Distribution of liabilities of an insurance (reinsurance) company based on losses incurred in accordance with Appendix 4 to these Requirements.

44. If, as of the reporting date, the value of the gross income tax implies a decrease of more than 30 (thirty) percent compared to the previous reporting date, the actuarial method specified in paragraph 41 of these Requirements, which provides for the largest amount of the gross income tax, is used to calculate the gross income tax.

45. The GPNU for a portfolio that includes contracts for the class of compulsory insurance of an employee against accidents during the performance of his labor (official) duties consists of two parts and is determined by the following formula:

OPNU = OPEN + OPNZU, where:

The liability for losses that have occurred but not yet been reported (hereinafter referred to as the OPEN) is calculated using actuarial methods specified in paragraph 41 of these Requirements. When an insurance (reinsurance) organization carries out activities in the class of compulsory insurance of an employee against accidents during the performance of labor (official) duties for less than 3 (three) years or there is insufficient data to calculate the OPENU using the methods specified in paragraph 41 of the Requirements, the OPENU is at least 5 (five) percent of the amount of the insurance premium under insurance (reinsurance) contracts and additional agreements to insurance (reinsurance) contracts for this class that came into force in the last twelve months preceding the calculation date.

When the actuary distributes the insurer's obligations on the basis of incurred losses when calculating OPENU using actuarial methods, the table of accumulated losses for calculating obligations for incurred but not reported losses using the chain ladder method without adjusting for inflation in the form in accordance with Appendix 1 to these Requirements is constructed by summing the reported but unresolved losses and the accumulated amounts of payments (paid losses) at the end of each period of occurrence of losses, used to construct a triangle of accumulated losses, according to the Table of accumulated losses based on incurred losses. Distribution of liabilities of an insurance (reinsurance) company based on incurred losses in accordance with Appendix 4 to these Requirements.

When the actuary distributes the insurer's obligations on the basis of incurred losses when calculating OPENU using actuarial methods, the table of accumulated losses adjusted for inflation for past periods. Calculation of obligations for incurred but not reported losses using the chain ladder method adjusted for inflation in the form in accordance with Appendix 2 to these Requirements is constructed by summing declared but unresolved losses and accumulated amounts of payments (paid losses) at the end of each loss period used to construct a triangle of accumulated losses, according to the Table of accumulated losses based on incurred losses. Distribution of liabilities of an insurance (reinsurance) company based on incurred losses in accordance with Appendix 4 to these Requirements.

When the actuary distributes the insurer's obligations on the basis of incurred losses when calculating OPENU using actuarial methods, the Table of accumulated losses Calculation of obligations for incurred but not reported losses using the Bornhuetter-Ferguson method in the form according to Appendix 3 to these Requirements is constructed by summing the declared but unresolved losses and the accumulated amounts of payments (paid losses) at the end of each loss period used to construct a triangle of accumulated losses, according to the Table of accumulated losses based on losses incurred. Distribution of liabilities of an insurance (reinsurance) company based on losses incurred in accordance with Appendix 4 to these Requirements.

The liability for losses that have occurred but not been fully reported (hereinafter referred to as LPNZU) is calculated for beneficiaries for whom insurance payment was made in connection with establishing the degree of LPL and compensation for damage to persons who suffered damage as a result of the death of an employee in accordance with Article 940 of the Civil Code.

OPNZU is formed in order to assess the expected obligations associated with the extension (re-examination) of the degree of UPT and compensation for damage to persons who suffered damage as a result of the death of an employee in accordance with Article 940 of the Civil Code, accepted by the insurance (reinsurance) company under insurance (reinsurance) contracts.

GPNZU is equal to the amount of projected payments associated with the extension (re-certification) of the UPT degree, determined individually for each beneficiary for whom the UPT degree has been established or for whom a repeated extension (re-certification) of the UPT degree is expected, and associated with compensation for damage to persons who suffered damage as a result of the death of an employee in accordance with Article 940 of the Civil Code.

The calculation of GPNZU is carried out in accordance with Appendix 2 to the Rules for calculating annuity payments under an annuity contract and on the requirements for an annuity contract and the permissible level of expenses of the insurer for conducting business under concluded annuity contracts, approved by the Resolution of the Board of the Agency of the Republic of Kazakhstan for Regulation and Supervision of the Financial Market and Financial Organizations dated March 1, 2010 No. 28 (registered in the Register of State Registration of Normative Legal Acts under No. 6156).

In order to assess the predicted payments for each beneficiary, the extension of the period for establishing the degree of UPT is carried out until the retirement age established by the Social Code of the Republic of Kazakhstan is reached, with a probability of 100 (one hundred) percent.

In order to assess projected payments, the OPNZU is formed for each person entitled to compensation for damage to persons who suffered damage as a result of the death of an employee in accordance with Article 940 of the Civil Code, with a probability of making payments of 100 (one hundred) percent.

If the insurance (reinsurance) organization does not receive an application for concluding an annuity agreement in connection with the repeated extension (re-examination) of the beneficiary’s UPT degree within 2 (two) years after the expiration of the annuity agreement, and the insurance (reinsurance) organization:

does not have information about the extension (re-certification) of the beneficiary’s UPT degree after the expiration of the annuity agreement, then the actuary, if necessary, excludes the given amount of projected payments for the beneficiary from the calculation of the beneficiary’s UPT;

2) has information about the extension (re-certification) of the beneficiary’s UPT degree after the expiration of the annuity contract, then the actuary evaluates the projected payments taking into account the probability of the beneficiary’s repeated application, calculated by the actuary based on his professional judgment.

When calculating the general liability insurance for groups of insurance (reinsurance) contracts related to insurance contracts concluded in accordance with the Law of the Republic of Kazakhstan dated February 7, 2005 “On compulsory insurance of an employee against accidents during the performance of labor (official) duties”, a mortality table is used, with mortality rates not higher than the mortality table indicators provided for by the Resolution of the Board of the Agency of the Republic of Kazakhstan for Regulation and Supervision of the Financial Market and Financial Organizations dated March 1, 2010 No. 28 “On approval of regulatory legal acts regulating the organization and implementation of activities for compulsory insurance of an employee against accidents during the performance of his labor (official) duties” (registered in the Register of State Registration of Regulatory Legal Acts under No. 6156).

In order to equalize the factors of development of losses when calculating GPNU and (or) OPENU using actuarial methods, the actuary, if necessary, makes an adjustment to the loss under an insurance (reinsurance) agreement that is large.

46. If an insurance (reinsurance) organization carries out activities according to the insurance class, with the exception of compulsory insurance of an employee against accidents during the performance of his labor (official) duties, for less than 3 (three) years or there is insufficient data for calculating the GNI using actuarial methods specified in paragraph 41 of these Requirements, the GNI is at least 5 (five) percent of the amount of the insurance premium under insurance (reinsurance) contracts and additional agreements to insurance (reinsurance) contracts that entered into force in the last 12 (twelve) months preceding the settlement date.

47. For a portfolio that includes contracts for the mortgage insurance class, the value of the GNI is at least 60 (sixty) percent of the amount of the insurance premium under insurance (reinsurance) contracts and additional agreements to insurance (reinsurance) contracts that entered into force over the last 12 (twelve) months preceding the date of calculation.

48. Discounting of liabilities for incurred insurance losses is carried out on the basis of actuarial assumptions in accordance with the Methodology for assessing insurance liabilities.

The rate of return used to discount cash flows when calculating liabilities for incurred insurance losses is determined on the basis of the risk-free yield curve of the relevant currency, adjusted for the liquidity and characteristics of the insurance liabilities themselves, or on the basis of market yields of financial instruments cleared of credit risk in accordance with the Methodology for the valuation of insurance liabilities.

In the case of calculating the gross income tax in accordance with clause 46 of the Requirements, the amount of the gross tax income is not discounted.

Chapter 7. Assessment of insurance liabilities using the method based on premium distribution

49. When an entity applies the premium allocation approach, the liability for the remaining insurance coverage is calculated as follows:

upon initial recognition:

OOSP0 = P0 - Ak0, where:

OOSP0 – liabilities for the remaining part of the insurance coverage at the time of initial recognition;

P0 – insurance premiums received at the time of initial recognition;

Ak0 – acquisition cash flows as of this date, except in cases where the organization decides to recognize these payments as expenses.

50. For subsequent reporting dates, the assessment of liabilities for the remaining part of the insurance coverage using the proportional distribution method is determined by the formula:

OOSPt = OOSPt-1 + Pt - Akt + AMt - Bt, where:

OOSPt-1 – liabilities for the remaining part of the insurance coverage, estimated for period t-1;

Пt – insurance premiums received in period t;

Akt – acquisition cash flows in period t, except for cases when the insurance (reinsurance) company decides to recognize these payments as expenses;

AMt – any amounts associated with the amortization of acquisition cash flows in period t;

Bt is the amount recognized as insurance proceeds due to the provision of services in period t.

51. Liabilities for incurred insurance losses for portfolios assessed using the premium distribution method are considered in accordance with paragraphs 34 - 48 of these Requirements.

52. Discounting of liabilities valued using the method based on the distribution of premiums is carried out on the basis of actuarial assumptions in accordance with the Methodology for Valuation of Insurance Liabilities.

Chapter 8. Risk adjustment

53. The risk adjustment is determined as of the calculation date separately for liabilities for the remaining part of the insurance coverage and liabilities for losses incurred by groups of insurance contracts in accordance with the Methodology for assessing insurance liabilities.

The risk adjustment takes into account, but is not limited to, insurance risk, termination risk and cost escalation risk.

54. The calculation of the risk adjustment is carried out using the method based on the confidence level in accordance with the Methodology for assessing insurance liabilities.

55. The risk adjustment to the liability for the remainder of the insurance coverage is subject to amortization over the life of the insurance contract.

56. The absolute value of the risk adjustment is subject to revision at each reporting date based on updated cash flows and the current assessment of inevitable non-financial risks inherent in the group of insurance (reinsurance) contracts.

The risk adjustment percentage (coefficient) is revised only if the risk level changes.

57. The risk adjustment to liabilities for the remaining portion of insurance coverage for portfolios valued using the premium distribution method is not calculated.

58. For reinsurance contracts, the insurance (reinsurance) organization applies similar criteria to identify portfolios of reinsurance contracts, as in relation to insurance contracts.

59. Insurance liabilities under reinsurance contracts include the reinsurer's share in the obligations for the remaining part of the insurance coverage and the reinsurer's share in the obligations for incurred insurance losses.

60. The assessment of cash flows under reinsurance contracts (including the assessment of expected compensation) is carried out using the same parameters as for insurance contracts: scenarios of probable cash flows, discount rates, structure of loss development and duration of payments, risk adjustment.

61. When assessing the reinsurer’s share in insurance liabilities, the insurance (reinsurance) organization is obliged to take into account the risk of the reinsurer’s failure to fulfill its obligations. This risk is included when calculating the present value of future cash flows.

62. The methodology for assessing the risk of non-fulfillment by the reinsurer of its obligations is determined in accordance with the Methodology for assessing insurance obligations.

63. For groups of reinsurance agreements (additional agreements), the reinsurer’s share in insurance liabilities is 0 (zero), except for cases where the insurance (reinsurance) organization has confirmation of the reinsurer (reinsurers) in writing about his (their) acceptance of risks for reinsurance (acceptance) indicating all the conditions of reinsurance (including the size of the insurance premium accepted by the reinsurer, obligations under the contract reinsurance, liability limit, assignor commission, insurance broker commission and (or) branch of a non-resident insurance broker of the Republic of Kazakhstan).

At the same time, if confirmation of the reinsurer (reinsurers) in writing about his (their) acceptance of risks for reinsurance (acceptance) indicating all the conditions of reinsurance (including the amount of the insurance premium accepted by the reinsurer, obligations under the reinsurance agreement, liability limit, commission of the cedant, commission of the insurance broker and (or) a branch of the non-resident insurance broker of the Republic of Kazakhstan) is available only for part of the group of reinsurance contracts (additional agreements), the reinsurer's share in insurance liabilities is subject to recognition in proportion to the corresponding share of the reinsurer's liability for which the insurance (reinsurance) organization has confirmation of the reinsurer (reinsurers) in writing about his (their) acceptance of risks for reinsurance (acceptance) indicating all the conditions of reinsurance (including the size of the insurance premium accepted by the reinsurer, obligations under the reinsurance agreement, liability limit, commission assignor, commission of an insurance broker and (or) a branch of a non-resident insurance broker of the Republic of Kazakhstan).

64. As confirmation of the reinsurer (reinsurers) that he (them) accepts risks for reinsurance (acceptance) before receiving the reinsurance contract, a reinsurance cover letter or a reinsurance slip with a signature sheet that meets the requirements of the regulatory legal act of the authorized body defining the conditions and procedure for carrying out the activities of an insurance broker and a branch of a non-resident insurance broker of the Republic of Kazakhstan is also accepted in accordance with paragraph 9 of the article 17 of the Law.

Appendix 1 to Requirements for the assessment and structure of insurance liabilities in accordance with international financial reporting standards

Calculation of liabilities for incurred but unreported losses using the chain ladder method without adjustment for inflation Reporting period: as of "" "___________" 20

Form

Table of losses as of the reporting date for _________________________ group of insurance contracts

The table of losses is formed on the basis of __________________________ losses (paid, incurred)

Period of occurrence of insured events (i) Losses by period (j) Frequency 1 2 ... n-2 n-1 n 1 X (1,1) X (1,2) X (1, n-2) X (1, n-1) X (1, n) 2 X (2,1) X (2,2) X (2, n-2) X (2, n-1) x 3 X (3,1) X (3,2) … Х (3, n-2) x x … … … … x x x n-1 Х (n-1,1) Х (n-1,2) x x x x n Х (n,1) x x x x x

Note:

X (i,j) - payments (paid losses) or incurred losses, at the end of the j-th period, for insured events that occurred in the i-th period;

n is the number of periods for which payment data is considered;

the Table of Losses as of the reporting date reflects payments (paid losses) or incurred losses, grouped by periods of occurrence of insured events.

Table of accumulated losses _________________________ group of insurance contracts

Period of occurrence of insured events (i) Accumulated losses (j) 1 2 ... n-2 n-1 n 1 S(1,1)=X (1,1) S(1,2) =X (1,1) + X (1,2) ... S(1,n-2) =X (1,1) + X (1,2)+... + X (1,n-2) S(1,n-1) = X (1,1) + X (1,2)+… + Х (1,n-2) + Х (1,n-1) S(1,n) =Х (1,1) + Х (1,2)+… + Х (1,n) 2 S(2,1)=Х (2,1) S(2,2) = Х (2,1) + Х (2,2) … S(2,n-2) = Х (2,1) + Х (2,2)+… + Х (2,n-2) S(2,n-1) =Х (2,1) + Х (2,2)+… + Х (2,n-2) + Х (2,n-1) x 3 S(3,1)=Х (3,1) S(3,2)=Х (3,1) + Х (3,2) … S(3,n-2) = Х (3,1) + Х(3,2)+… + Х (3,n-2) x x … … … … x x x n-1 S(n-1,1)=Х (n-1,1) S(n-1,2)= Х (n-1,1) + Х (n-1,2) x x x x n S(n,1)= Х (n,1) x x x x x

Note: The Table of Accumulated Losses indicates the total amounts of payments (paid losses) or incurred losses, grouped by periods of occurrence of insured events.

Table of loss development coefficients g(j)__________________________________________________________

Loss development method (arithmetic average, average for n-periods, average value)

Period of occurrence of losses (i) Loss development factors (j) 1 2 … n-2 n-1 n 1 … x 2 … x x 3 … x x x … … … … x x x n-1 x x x x n x x x x x x Loss development factors g(j) g(j) 1 2 … n-2 n-1 n average arithmetic x average for n-periods x average value x

Note: in the Table of Loss Development Factors, loss development factors F(i,j) are determined, corresponding to the relative increase in the total amount of losses from one payment period to the next, according to the following formula:

Loss development factor = F(i,j)= S (i,j+1)/S (i,j).

Loss development factors g(j) are calculated as the average value of loss development factors over the periods of loss occurrence.

Table of projected accumulated losses for _________________________ group of insurance contracts

Period of occurrence of insured events (i) Projected accumulation of losses 1 2 … n-2 n-1 n 1 x x x x x x 2 x x x x x UL(2,n) = S(2,n-1) * g(n-1) … … … … … … n-1 x x … S(n-1,2) * g(2) * … * g(n-3) S(n-1,2) * g(2) * … * g(n-2) UL(n-1,n) = S(n-1,2) * g(2) * … * g(n-1) n x S(n,1) * g(1) … S(n,1) * g(1) * g(2) * … * g(n-3) S(n,1) * g(1) * g(2) * … * g(n-2) UL(n,n) = S(n,1) * g(1) * g(2) * … * g(n-1)

Note: The Projected Cumulative Loss Table identifies the expected amount of payments or incurred losses in each period.

The expected value of payments or incurred losses is calculated as the product of accumulated payments or incurred losses S (i,j-1) in the period of occurrence of losses i from the Table of accumulated losses, and the Table of loss development coefficients g(j).

Table of losses for _________________________ group of insurance contracts

Period of occurrence of insured events (i) Projected accumulation of losses Amount of losses by periods 1 2 … n-2 n-1 n 1 x x x x x x x 2 x x x x x UL(2,n) = S(2,n-1) * g(n-1) UL(2,n)-S(2,n-1) … … … … … … … n-1 x x … S(n-1,2) * g(2) * … * g(n-3) S(n-1,2) * g(2) * … * g(n-2) UL(n-1,n) = S(n-1,2) * g(2) * … * g(n-1) UL(n-1,n)-S(n-1,2) n x S(n,1) * g(1) … S(n,1) * g(1) * g(2) * … * g(n-3) S(n,1) * g(1) * g(2) * … * g(n-2) UL(n,n) = S(n,1) * g(1) * g(2) * … * g(n-1) UL(n, n)-S(n,1)

Table of occurred but unreported losses for ____________________ group of insurance contracts

Period of occurrence of insured events (i) Losses incurred by period Reported but not settled losses Occurred but unreported losses 1 2 3 1 2 3 … n-1 n Total

Note:

The Table of occurred but unreported losses indicates:

in the column “Arrears of losses by periods” - the values of losses in the corresponding periods;

in the column “Declared but not settled losses” - the amount of declared losses in the relevant periods;

in the column “Occurred but not reported losses” - the difference between the columns “Arreared losses by period” and “Declared but not settled losses” in the corresponding period. In case of a negative difference, the value 0 (zero) is taken in the column “Occurred but not reported losses”;

if the calculation is based on payments, then the GPNU is the amount of incurred but unreported losses indicated in column 3 of the Table of Obligations for Occurred, but Unreported Losses; if the calculation is based on incurred losses, then the GPNU is the amount of incurred losses by period.

Appendix 2 to Requirements for the assessment and structure of insurance liabilities in accordance with international financial reporting standards

Calculation of liabilities for incurred but unreported losses using the chain ladder method adjusted for inflation

Reporting period: as of "" "___________" 20

Form

Table of losses as of the reporting date for ______________________ group of insurance contracts

The table of losses is formed on the basis of __________________________ losses (paid, incurred)

Period of occurrence of insured events (i) Losses by period (j) Frequency 1 2 … n-2 n-1 n 1 2 x 3 x x … … … … x x x n-1 x x x x n x x x x x

Note: the Table of Losses as of the reporting date reflects payments (paid losses) or incurred losses, grouped by periods of occurrence of insured events.

Table of information on inflation for each past period

Periods Inflation over the past period (in percent) 1 2 3 … n-1 n

Note: the Table of Information on Inflation for each past period indicates the accumulated values of official inflation values for the period of occurrence of insured events.

Table of losses adjusted for inflation for past periods for ______________________ group of insurance contracts

Period of occurrence of insured events (i) Losses by periods adjusted for inflation for past periods (j) 1 2 … n-2 n-1 n 1 2 x 3 x x … … … … x x x n-1 x x x x n x x x x x

Table of accumulated losses adjusted for inflation for past periods for ________________ group of insurance contracts

Period of occurrence of insured events (i) Cumulative losses adjusted for inflation for past periods (j) 1 2 … n-2 n-1 n 1 2 x 3 x x … … … … x x x n-1 x x x x n x x x x x

Table of loss development coefficients g(j) ____________________________________________ loss development method (arithmetic mean, average for n-periods, average value)

Period of occurrence of insured events (i) Loss development factors (j) 1 2 … n-2 n-1 n 1 2 x 3 x x … … … … x x x n-1 x x x x n x x x x x Loss development factors g(j) g(j) 1 2 … n-2 n-1 n arithmetic average x average for n-periods x average value x

Table of projected accumulated losses adjusted for inflation for past periods

By _______________________

group of insurance contracts

Period of occurrence of insured events (i) Projected accumulation of losses adjusted for inflation over past periods 1 2 … n-2 n-1 n 1 x x … x x x 2 x x … x x 3 x x … x … … … … … … … n-1 x x … n x

Table of losses adjusted for inflation for past periods for ___________________ group of insurance contracts

Period of occurrence of insured events (i) Projected accumulation of losses adjusted for inflation over past periods Amount of losses by periods 1 2 … n-2 n-1 n 1 x x … x x x 0 2 x x … x x 3 x x … x … … … … … … … n-1 x x … n x Amount of losses adjusted for inflation over past periods

Table of occurred but unreported losses for ____________________ group of insurance contracts

Period of occurrence of insured events (i) Losses incurred by period Reported but not settled losses Occurred but unreported losses 1 2 3 1 2 3 … n-1 n Total

Note:

The Table of occurred but unreported losses indicates:

in the column “Arrears of losses by periods” - the values of losses in the corresponding periods;

in the column “Declared but not settled losses” - the amount of declared losses in the relevant periods;

Appendix 3 to Requirements for the assessment and structure of insurance liabilities in accordance with international financial reporting standards

Calculation of the amount of incurred but unreported losses using the Bornhuetter-Ferguson method

Reporting period: as of "" "___________" 20

Form

Table of losses as of the reporting date for _______________________ group of insurance contracts

The table of losses is formed on the basis of __________________________ losses (paid, incurred)

Period of occurrence of insured events (i) Losses by period (j) Frequency 1 2 … n-2 n-1 n 1 X (1,1) X (1,2) X (1, n-2) X (1, n-1) X (1, n) 2 X (2,1) X (2,2) X (2, n-2) X (2, n-1) x 3 x x … … … … x x x n-1 X (n-1,1) X (n-1,2) x x x x n X (n,1) x x x x x

Note:

X (i,j) – payments (paid losses) or incurred losses, at the end of the j-th period, for insured events that occurred in the i-th period;

n – number of periods for which loss data is considered;

the Table of Losses as of the reporting date reflects payments (paid losses) or incurred losses, grouped by periods of occurrence of insured events.

Table of accumulated losses for _______________________ group of insurance contracts

Period of occurrence of insured events (i) Accumulated losses (j) 1 2 … n-2 n-1 n 1 S(1,1)=Х (1,1) S(1,2) =(Х (1,1) + Х (1,2) … S(1,n-2) =(Х (1,1) + Х (1,2)+… + Х (1,n-2) S(1,n-1) =( Х (1,1) + X (1,2)+… + X (1,n-2) + X (1,n-1) S(1,n) =X (1,1) + X (1,2)+… + X (1,n) 2 S(2,1)=X (2,1) S(2,2) =X (2,1) + X (2,2) … S(2,n-2) =(X (2,1) + X (2,2)+… + X (2,n-2) S(2,n-1) =X (2,1) + X (2,2)+… + X (2,n-2) + X (2,n-1) x 3 S(3,1)=X (3,1) S(3,2)= X (3,1) + X (3,2)… S(3,n-2) =(X (3,1) + X(3,2)+… + X (3,n-2) x x … … … … x x x n-1 S(n-1,1)=Х (n-1,1) S(n-1,2)= Х (n-1,1) + Х (n-1,2) x x x x n S(n,1)= Х (n,1) x x x x x

Note: The Accumulated Loss Table indicates the total payments (paid losses) or incurred losses, grouped by periods of occurrence of insured events.

Table of loss development coefficients g(j) ________________________________________________ loss development method (arithmetic mean, average for n-periods, average value)

Note: in the Table of Loss Development Factors, loss development factors F(i,j) are determined, corresponding to the relative increase in the total amount of declared losses from one payment period to the next, according to the following formula:

Loss development factor F(i,j)= S (i,j+1)/S (i,j).

Loss development factors g(j) are calculated as the average value of loss development factors over the periods of loss occurrence.

Odds table

Period of occurrence of insured events (i) Loss development coefficients g(j) Loss development factors f (j) Delay factors h(j)= 1 - 1/f (j) 1 1 1 1-1/ 1 2 g(n-1) 1g(n-1) 1-1/( g(n-1)) 3 g(n-2) 1g(n-1) g(n-2) 1-1/ (1g(n-1) g(n-2) … … … … n-1 g(2) 1g(n-1) g(n-2)…* g(2) 1-1/ (1g(n-1) g(n-2)… g(2)) n g(1) 1g(n-1)g(n-2)… g(2)g(1) 1-1/ (1g(n-1) g(n-2)…* g(2)*g(1))

Note: the Table of Coefficients indicates:

in the column “Loss development coefficients g(j)” – the values of the loss development coefficients indicated in the Table of loss development coefficients g(j);

in the column “Loss development factors f (j)” – accumulated values of loss development factors;

in the column “Lagging factors h(j)” – values equal to 1 - 1/f (j), where f (j) is a development factor.

Table for calculating the loss ratio for policies

Fiscal year (y) Losses incurred Premiums earned Policy loss ratio 1 2 3 4 1 UL(1) UP(1) U(1)=UL(1)/UP(1) 2 UL(2) UP(2) U(2)=UL(2)/UP(2) … … … … m-1 UL(m-1) UP(m-1) U(m-1)=UL(m-1)/UP(m-1) m UL(m) UP(m) U(m)=UL(m)/UP(m)

Note:

in the Loss Ratio Calculation Table:

the column “Losses Incurred” shall indicate the values of losses incurred as of the reporting date, including expenses for the settlement of losses, under insurance (reinsurance) contracts that entered into force in the financial year preceding the period of occurrence of insured events;

in the column “Earned premiums” the earned premium under insurance (reinsurance) contracts that entered into force in the financial year preceding the period of occurrence of insured events is indicated;

The loss ratio U is determined by the following formula:

U = [U (1) + U (2) + … + U(m)]/m, where:

U(m) - loss ratios for policies for each m-th financial year preceding the period of occurrence of insured events, calculated as the ratio of the amount of losses incurred, including expenses for adjusting losses, under insurance (reinsurance) contracts that entered into force in the corresponding financial year to insurance premiums earned on the reporting date under these contracts;

m – number of financial years.

Liability table for incurred but unreported losses

Period of occurrence of insured events (i) Earned premiums Loss ratio U Expected final losses z(i) Lag factors h(j) Losses that occurred but were not paid at the reporting date R(i) Claimed but not settled at the reporting date Losses that occurred but were not reported 1 2 3=12 4 5=34 6 7=5-6 1 2 3 … n-1 n Total

Appendix 4 to Requirements for the assessment and structure of insurance liabilities in accordance with international financial reporting standards

Distribution of liabilities of an insurance (reinsurance) company based on losses incurred

Table of accumulated amounts of payments (paid losses), grouped by periods of occurrence of insured events

Period of occurrence of insured events (i) Accumulated paid losses by period (j) Frequency 1 2 … n-2 n-1 n 1 X (1,1) X (1,1) + X (1,2) X (1,1) + … + X (1, n-2) X (1,1) + … + X (1, n-2) + X (1, n-1) X (1,1) + … + X (1, n-1) + X (1, n) 2 X (2,1) X (2,1) + X (2,2) X (2,1) + ... + X (2, n-2) X (2,1) + ... + X (2, n-2) + X (2, n-1) x 3 X (3,1) X (3,1) + X (3,2) ... X (3,1) + ... + X (3, n-2) x x … … … … x x x n-1 X (n-1,1) X (n-1,1) + X (n-1,2) x x x x n X (n,1) x x x x x

X (i,j) – payments (paid losses) at the end of the j-th period, for insured events that occurred in the i-th period.

Table of reported outstanding losses grouped at the end of each loss period

Period of occurrence of insured events (i) Reported unsettled losses by period (j) Frequency 1 2 … n-2 n-1 n 1 Y (1,1) Y (1,2) Y (1, n-2) Y (1, n-1) Y (1, n) 2 Y (2,1) Y (2,2) Y (2, n-2) Y (2, n-1) x 3 Y (3,1) Y (3,2) … Y (3, n-2) x x … … … … x x x n-1 Y (n-1,1) Y (n-1,2) x x x x n Y (n,1) x x x x x

Y (i,j) – declared losses at the end of the j-th period, for insured events that occurred in the i-th period.

Table of accumulated losses based on losses incurred__________________ as of the reporting date

Period of occurrence of insured events (i) Losses incurred (j) Frequency 1 2 … n-2 n-1 n 1 X (1,1) + Y (1,1) X (1,1) + X (1,2) + Y (1,2) X (1,1) + … + X (1, n-2) + Y (1, n-2) X (1,1) + … + X (1, n-2) + X (1, n-1) + Y (1, n-1) Х (1,1) + … + Х (1, n-1) + Х (1, n) + Y (1, n) 2 Х (2,1) + Y (2,1) Х (2,1) + Х (2,2) + Y (2,2) Х (2,1) + … + Х (2, n-2) + Y (2, n-2) Х (2,1) + … + Х (2, n-2) + X (2, n-1) + Y (2, n-1) x 3 X (3,1) + Y (3,1) X (3,1) + X (3,2) + Y (3,2) ... X (3,1) + ... + X (3, n-2) + Y (3, n-2) x x ... ... ... ... x x x n-1 X (n-1,1) + Y (n-1,1) X (n-1,1) + X (n-1,2) + x x x x Y (n-1,2) n X (n,1) + Y (n,1) x x x x x

Approved by Resolution of the Board of the Agency of the Republic of Kazakhstan for Regulation and Development of the Financial Market dated "" "_______" 2025 No. ___

Requirements for automating the assessment of insurance liabilities

An insurance (reinsurance) organization is obliged to ensure automation of the process of assessing insurance liabilities.

2. To automate the assessment of insurance obligations, the insurance (reinsurance) organization ensures the availability of an information system or system component (module, subsystem) for the assessment of insurance (reinsurance) contracts, ensuring the performance of the following functions:

aggregation and segmentation of insurance (reinsurance) contracts;

2) actuarial calculations for all necessary models for assessing insurance liabilities, including calculation of the expected current value of cash flows, risk adjustment, margin for services provided for in the contract;

3) accounting and control of changes in key actuarial assumptions.

3. The information system for evaluating insurance (reinsurance) contracts must be integrated with other information system(s) of accounting, reporting and control used in the insurance (reinsurance) organization to ensure the completeness, reliability and relevance of accounting data.

4. An information system or system component (module, subsystem) for evaluating insurance (reinsurance) contracts must be able to load actuarial assumptions and other accounting data used for evaluation.

5. The logic of actuarial calculations in the information system or in a system component (module, subsystem) must be available for viewing and editing.

At the same time, the insurance organization must have an internal procedure for making changes to the logic of actuarial calculations in the information system or in a system component (module, subsystem), which must undergo an internal approval procedure, including the stages of documentation, verification, testing and approval by the executive body of the insurance (reinsurance) organization.

The history of changes made to the logic of actuarial calculations in an information system or in a system component (module, subsystem) must be saved and be fully traceable. The system must provide the ability to identify the user who made the changes, the date and content of such changes, and also store the corresponding versions of the calculation algorithms for subsequent control.

6. The information system must ensure differentiation of access rights to functions and data in accordance with the job responsibilities of users.

7. The system keeps a log of user actions, which allows you to track changes and use of information.

8. An information system or system component (module, subsystem) intended for assessing insurance (reinsurance) obligations must provide an interface that provides the ability to:

launching a full calculation process for assessing insurance liabilities;

2) launching individual stages of the calculation process (including calculation of expected cash flows, risk adjustment, margin for services provided for in the contract);

3) restarting one or more stages of the calculation process without the need for complete data processing;

4) monitoring and tracking the current status of the implementation of each stage of the costing process in an automated system.

9. An information system or a system component (module, subsystem) intended for assessing insurance (reinsurance) obligations must have complete and up-to-date documentation, including:

description of the system architecture, used algorithms and logic of actuarial calculations;

2) description of business processes implemented in the system;

3) instructions for users and system administrators;

4) list and description of input and output data, including format and source of receipt;

5) regulations for updating and verifying the reliability of reference information and actuarial assumptions;

6) description of procedures for ensuring information security and access control;

7) information about system versions and history of changes (including updates to functionality, calculation logic, data structure, etc.).

Documentation must be kept up to date.

10. The management employee of the insurance (reinsurance) organization is responsible for organizing and ensuring automation of the process of assessing insurance liabilities.

Approved by the Resolution of the Board of the Agency of the Republic of Kazakhstan for Regulation and Development of the Financial Market dated "" "_______" 2025 No. ___

Requirements for the methodology for assessing insurance liabilities

The insurance (reinsurance) organization, within one month from the date of entry into force of this resolution, must develop and approve a Methodology for assessing insurance liabilities in accordance with these Requirements.

2. An insurance (reinsurance company) organization that has received a license to carry out insurance (reinsurance) activities develops and approves a Methodology for assessing insurance liabilities within one month from the date of receipt of the license to carry out insurance (reinsurance) activities.

3. The methodology for assessing insurance liabilities, as well as changes and (or) additions made to the Methodology for assessing insurance liabilities, are approved by the executive body of the insurance (reinsurance) organization and agreed upon with the authorized body.

4. The methodology for assessing insurance liabilities contains, but is not limited to:

rules for identifying portfolios and groups of insurance (reinsurance) contracts, including criteria for risk homogeneity, management and periods for concluding contracts;

2) the procedure for classifying contracts as onerous and non-onerous at the date of initial recognition, including a description of the test for onerousness;

3) valuation model for all types of insurance contracts (general valuation model or insurance premium distribution method);

4) criteria for applying the insurance premium distribution method, including a test for its applicability;

5) a detailed procedure for assessing insurance liabilities for groups of insurance contracts, revealing, among other things, a detailed procedure for calculating expected future cash flows (incoming and outgoing), discount factor, present value of future cash flows, forecast of future cash flows;

6) criteria and methods for determining the discount rate, indicating sources of market data;

7) method for determining the risk adjustment, including description and actuarial assumptions;

8) a list of expenses classified as acquisition expenses, including: direct and indirect expenses, criteria for recognition and classification into groups of contracts;

9) criteria for assessing the risk of non-fulfillment of obligations by the reinsurer under reinsurance contracts;

10) rules and frequency of updating key parameters, assumptions and accounting estimates;

11) the procedure for collecting, verifying and storing statistical information used in calculating insurance liabilities;

12) procedures for documenting calculations, assumptions and results, including storage and availability of the methodology for supervision and audit purposes;

13) a list of structural units of a financial organization participating in the process of assessing insurance liabilities with a description of their functional responsibilities, as well as business processes of interaction between structural units of a financial organization;

14) the procedure for determining the loss component;

15) criteria for classifying losses as major;

16) list and procedure for applying actuarial assumptions.

It is not allowed to determine in the Methodology for assessing insurance obligations incomplete lists and (or) information provided for in part one of this paragraph.

It is not permitted to use in the Methodology for Assessing Insurance Liabilities references to sources, documents, information and (or) grounds that are not specified in the Methodology for Assessing Insurance Liabilities.

5. The methodology for assessing insurance liabilities contains a reasonable and statistically confirmed segmentation of insurance contracts with homogeneous characteristics (in the absence of sufficient statistics, expert substantiation of segmentation is allowed), as well as:

a list of criteria used to segment insurance contracts with homogeneous characteristics (product type, term, industry, risk and other criteria);

2) a description of approaches to statistical analysis of segmentation of insurance contracts with homogeneous characteristics (including analysis of homogeneity, sufficiency of statistics and other components), as well as in the case of using an expert approach, a description and justification of segmentation based on the expert approach.

6. Amendments and (or) additions to the Methodology for assessing insurance liabilities are carried out on one or more of the following grounds:

non-compliance of the approved Methodology for assessing insurance liabilities with international financial reporting standards and the requirements of the legislation of the Republic of Kazakhstan on accounting and financial reporting;

2) changing the list of structural divisions of a financial organization involved in the process of determining the amount of insurance liabilities and their functional responsibilities, specified in the Methodology for assessing insurance liabilities;

3) increasing the accuracy of assessing insurance liabilities and improving the procedure for determining their size;

4) launch of new insurance products that provide features in the structure of cash flows and the level of risk, requiring the development of a unique methodology for assessing insurance liabilities.

Approved by the Resolution of the Board of the Agency of the Republic of Kazakhstan for Regulation and Development of the Financial Market dated "" "_______" 2025 No. ___

Requirements for the procedure and timing of approval of the methodology for assessing insurance liabilities

Copies approved by the executive body of the insurance (reinsurance) company, the Methodology for assessing insurance liabilities and (or) changes and (or) additions made to the Methodology for assessing insurance liabilities, and information on changes and (or) additions made to the Methodology for assessing insurance liabilities in the form according to Appendix 1 to these Requirements are submitted by the insurance (reinsurance) organization to the authorized body no later than five working days from the date of approval by the executive body of the insurance company (reinsurance) organization Methodology for assessing insurance liabilities and (or) changes and (or) additions to the Methodology for assessing insurance liabilities.

2. Based on the results of consideration of copies of the Methodology for Assessing Insurance Liabilities and (or) changes and (or) additions made to the Methodology for Assessing Insurance Liabilities, approved by the executive body of the insurance (reinsurance) organization, the authorized body, no later than 60 (sixty) calendar days from the date of receipt of the documents specified in paragraph 1 of these Requirements, sends the insurance (reinsurance) company a notice of the absence or presence of comments to the Methodology for Assessing Insurance Liabilities and (or) changes and (or) additions made to the Methodology for assessing insurance liabilities, in the form in accordance with Appendix 2 to these Requirements.

In the course of exercising control and supervision over insurance activities, the authorized body sends the insurance (reinsurance) organization information about the absence or presence of comments on the Methodology for the assessment of insurance liabilities and (or) changes and (or) additions made to the Methodology for the assessment of insurance liabilities in the form in accordance with Appendix 2 to these Requirements.

The comments of the authorized body are eliminated by the insurance (reinsurance) company no later than 30 (thirty) working days from the date of receipt of the notifications provided for in parts one and two of this paragraph.

The provisions of the Methodology for Assessing Insurance Liabilities, subject to change and (or) addition on one or more grounds provided for in paragraph 6 of the Requirements for the Methodology for Assessing Insurance Liabilities, are not applied until the insurance (reinsurance) organization eliminates the comments of the authorized body, as well as bringing it into compliance with international financial reporting standards and the requirements of the legislation of the Republic of Kazakhstan on accounting and financial reporting.

Appendix 1 to the Requirements for the procedure and timing of approval of the methodology for assessing insurance liabilities Form

Information on changes and (or) additions to the Methodology for assessing insurance liabilities

Full name of the financial institution: _____________________________________________

As of "" "_______" 20

(in thousands of tenge)

Footnote: No. Clause, sub-clause of the Methodology for Assessing Insurance Liabilities Revision before making changes and (or) additions to the Methodology for Assessing Insurance Liabilities Edition after making changes and (or) additions to the Methodology for Assessing Insurance Liabilities Grounds for making changes and (or) additions to the Methodology for Assessing Insurance Liabilities and comments on the grounds for making changes and (or) additions to the Methodology for Assessing Insurance Liabilities Estimated estimate of changes in the amount of insurance liabilities as a result of changes and (or) additions made to Methodology for assessing insurance liabilities 1 2 3 4 5 6 1 2

Actuary _____________________________________________________ ________________ __________________ last name, first name and patronymic (if any) signature license No.

The first manager or a person authorized by him to approve the Methodology for assessing insurance liabilities and (or) changes and (or) additions made to the Methodology for assessing insurance liabilities ____________________________________________________________ _________________ last name, first name and patronymic (if any) signature

Appendix 2 to the Requirements for the procedure and timing of approval of the methodology for assessing insurance liabilities

Information about the absence or presence of comments on the Methodology for assessing insurance liabilities and (or) changes and (or) additions made to the Methodology for assessing insurance liabilities

Full name of the financial institution: ________________________________________________

As of "" "_______" 20

Footnote: about the absence of comments to the Methodology for assessing insurance liabilities and (or) changes and (or) additions made to the Methodology for assessing insurance liabilities ☐ about the presence of comments to the Methodology for assessing insurance liabilities and (or) changes and (or) additions made to the Methodology for assessing insurance liabilities according to the table ☐ No. Structural element number Revision of the structural element Comment Deadline for elimination 1. 2. ...

Head or deputy head of the authorized body _______________________________________ _____________ last name, first name and patronymic (if any) signature

Valuation of insurance liabilities under IFRS (Resolution No. 84)

Requirements for the Valuation and Structure of Insurance Liabilities in Accordance with IFRS (Resolution No. 84)

Requisites

Subject of the document

Relevance for actuarial practice

Official source

English Translation (Auto-generated)

Requirements for the assessment and structure of insurance liabilities in accordance with international financial reporting standards

Chapter 1. General provisions

Chapter 2. Requirements for assessing insurance liabilities in accordance with international financial reporting standards

Chapter 3. Aggregation, segmentation of insurance contracts

Chapter 4. Structure of insurance obligations

Chapter 5. Initial assessment of insurance liabilities using the general assessment model

Chapter 6. Subsequent valuation of insurance liabilities using the general valuation model

Chapter 7. Assessment of insurance liabilities using the method based on premium distribution

Chapter 8. Risk adjustment

Chapter 9. The reinsurer's share in insurance liabilities

Calculation of liabilities for incurred but unreported losses using the chain ladder method without adjustment for inflation Reporting period: as of "" "___________" 20

Calculation of liabilities for incurred but unreported losses using the chain ladder method adjusted for inflation

Reporting period: as of "" "___________" 20

Calculation of the amount of incurred but unreported losses using the Bornhuetter-Ferguson method

Reporting period: as of "" "___________" 20

Distribution of liabilities of an insurance (reinsurance) company based on losses incurred

Table of accumulated amounts of payments (paid losses), grouped by periods of occurrence of insured events

Requirements for automating the assessment of insurance liabilities

Requirements for the methodology for assessing insurance liabilities

Requirements for the procedure and timing of approval of the methodology for assessing insurance liabilities

Information on changes and (or) additions to the Methodology for assessing insurance liabilities

Information about the absence or presence of comments on the Methodology for assessing insurance liabilities and (or) changes and (or) additions made to the Methodology for assessing insurance liabilities