FASB 115

What Does FASB 115 Mean?

FASB 115 is a rule established by the Financial Accounting Standards Board requiring insurers to report their securities with fixed maturities at their current market value, rather than at past or potential future values. Fixed maturity securities are how insurers back long-term products like annuities, since predictable bond payments line up with the payouts the company has promised.

Insuranceopedia Explains FASB 115

FASB 115 is a financial regulation that insurance companies must comply with regarding the valuation of securities. This reporting standard enables the Financial Accounting Standards Board (FASB) to monitor insurance companies for legal and taxation purposes. Insurance companies that fail to comply with FASB 115 may face penalties such as fines, making it beneficial for them to adhere to the rule by reporting the market value of their securities with fixed maturities. These reporting rules are part of how regulators and rating agencies assess insurer financial health, which is worth checking when you compare the best life insurance companies.