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Tokio Marine Safety Insurance (Thailand) Public Company Limited
Notes to the Financial Statements
Tokio Marine Safety Insurance (Thailand) Public Company Limited
Notes to the Financial Statements
For the year ended 31 December 2023
For the year ended 31 December 2023

d) Debt instruments

Subsequent measurement of debt instruments depends on the Company’s business model for
managing the asset and the cash flow characteristics of the financial assets. There are three
measurement categories into which the Company classifies its debt instruments:

 Amortised cost: Financial assets that are held for collection of contractual cash flows
where those cash flows represent solely payments of principal and interest are measured at
amortised cost. Interest income from these financial assets is included in investment
income using the effective interest rate method. Any gain or loss arising on derecognition is
recognised directly in profit or loss and presented in other gains/(losses) together with
foreign exchange gains and losses. Impairment losses are presented as a separate
line item in the statement of comprehensive income.

 FVOCI: Financial assets that are held for i) collection of contractual cash flows; and ii) for
selling the financial assets, where the assets’ cash flows represent solely payments of
principal and interest, are measured at FVOCI. Movements in the carrying amount are
taken through other comprehensive income (OCI), expect for the recognition of impairment
gains or losses, interest income using the effective interest method, and foreign exchange
gains and losses which are recognised in profit or loss. When the financial assets is
derecognised, the cumulative gain or loss previously recognised in OCI is reclassified
from equity to profit or loss and recognised in other gains/(losses). Interest income is
included in investment income. Impairment expenses are presented separately in the
statement of comprehensive income.

 FVPL: Financial assets that do not meet the criteria for amortised cost or FVOCI are
measured at FVPL. A gain or loss on a debt investment that is subsequently measured
at FVPL is recognised in profit or loss and presented net within other gains/(losses) in
the period in which it arises.

e) Equity instruments

The Company measures all equity investments at fair value. Where the Company has
elected to present fair value gains and losses on equity instruments in OCI, there is no
subsequent reclassification of fair value gains and losses to profit or loss following the
derecognition of the investment. Dividends from such investments continue to be recognised
in profit or loss as investment income when the right to receive payments is established.

f) Impairment

The Company assesses on a forward looking basis the expected credit loss associated with
its debt instruments carried at amortised cost and FVOCI. The Company applies TFRS 9 general
approach in measuring the impairment of those financial assets. Under the general approach,
the 12- month or the lifetime expected credit loss is applied depending on whether there has
been a significant increase in credit risk since the initial recognition.

The significant increase in credit risk (from initial recognition) assessment is performed
every end of reporting period by comparing i) expected risk of default as of the reporting
date and ii) estimated risk of default on the date of initial recognition.

The Company assesses expected credit loss by taking into consideration forward-looking
information and past experiences. The expected credit loss is a probability-weighted estimate
of credit losses (probability-weighted present value of estimated cash shortfall). The cash
shortfall is the difference between all contractual cash flows that are due to the Company and
all cash flows expected to receive, discounted at the original effective interest rate.

When measuring expected credit losses, the Company reflects the following:

 probability-weighted estimated uncollectible amounts
 time value of money; and
 supportable and reasonable information as of the reporting date about past experience,
current conditions and forecasts of future situations.

Impairment (and reversal of impairment) losses are recognised in profit or loss.

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130 | รายงานประจำาปี 2566 | ANNUAL REPORT 2023