The Role of applying The Insurance Contracts Standard (IFRS 17) in Activating The Relationship Between Solvency II and Investments Profitability of Egyptian Insurance Companies

The research aims at studying and analyzing the requirements of the application of IFRS: 17 in terms of recognition principles, measurement approaches, methodology and mechanisms of presentation and disclo-sure to be followed by Egyptian insurance companies according to the application of this standard, and to determine the role of its application in activating the relationship between solvency indicators as regulatory standards guiding the supervisory and supervisory entities in this field locally and internationally, and improving the profitability of the inve-stments of Egyptian insurance companies as an objective measure that accurately reflects the economics of insurance entities. The researcher presented a theoretical methodology based on four main sections re-lated to the research variables and achieve its objectives, as well as an applied study on a sample of five insurance companies operating in the Egyptian market in the field of property and liability insurance (Misr Insurance Company, Suez Canal, Mohandes Co., Delta, gig-Egypt Insurance). Through a five-year time series from 2014 to 2018 of 25 views, the financial performance indicators for these companies were assessed before the IFRS17 was applied once, and applied another time as a trial framework, a range of statistical methods (Descriptive An-alysis, Multiple Discriminant analysis, correlation analysis, path anal-
 
 
ysis) through SPSS software for data analysis and hypothesis testing. The researcher has concluded that: the integration between accounting standards related to insurance contracts IFRS: 17 and international regulatory standards Solvency II contributes to improve the credibility and fairness of financial reports in insurance companies in terms of: Accurate measurement and objectivity of the financial position, impr-ove the profitability of financial performance, increase the level of disc-losure And transparency, and contribute to the development of adequate and accurate indicators to assess financial performance. It was also concluded that there was a significant difference between the insurance companies under study on both the solvency and profitability in-dicators. In addition, there is a significant (inverse) relationship bet-ween Solvency II and the profitability indicators of these companies. Finally, the results of the applied study revealed that the application of the standard IFRS: 17 contributes to activate the relationship between solvency II indicators and profitability indicators by reducing the degree of adverse impact between these indicators, which enables the company to form a barrier of solvency enhance its ability to pay its obligations towards policyholders, as well as directing its investments towards investment channels that ensure the highest profitability.