A NEW METHOD OF ASSESSMENT OF THE INSURANCE SERVICE PRODUCTION

The French national accounts applied the insurance production assessment method recommended by the European system of accounts (ESA), for the years 1970 to 1985, in a particularly turbulent economic and financial environment. A better understanding of the sector was thereby obtained, but the problems set by the very "technical" production assessment method were thus brought to light. These problems are still not solved by the present accounting system, since, to summarize matters, it hides the importance of the sector's "financial" activity, whereas in fact the income drawn from this activity contributes to a high extent to the global balance of insurance operations. This is of course related to the reasons why in certain countries insurance companies are considered more as savings collecting and investment institutions rather than risk transformers.
This report sheds light on the significance of the present premiums, indemnities and reserves recording method and then presents the new method chosen by the french accounts to assess production; finally it analyses the remaining difficulties relating mainly to capital gains.