{"schema_version":2,"canonical_url":"https://asc.understandingaccounting.org/asc/720/20/#15-scope-and-scope-exceptions","source":"FASB Accounting Standards Codification, Basic View","usage":"Study and research edition. Verify current requirements with the official source. Summaries, enrichment, and tags are machine-generated study aids. Paragraph html preserves source markup; snippet is abbreviated. Pending content is not necessarily effective.","topic":"720","topic_title":"Other Expenses","subtopic":"720-20","subtopic_title":"Insurance Costs","section":{"number":"15","label":"15 Scope and Scope Exceptions","anchor":"15-scope-and-scope-exceptions","is_sec":false,"groups":[{"block":null,"heading":"Overall Guidance","paragraphs":[{"citation":"720-20-15-1","para":"15-1","html":"
The General Subsection of this Section establishes the pervasive scope for this Subtopic, with specific exceptions noted in the other Subsections of this Section.
","snippet":"The General Subsection of this Section establishes the pervasive scope for this Subtopic, with specific exceptions noted in the other Subsections of this Section.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:b09d24d4d06f40716d2087b5f785c5d65e449098dc0087daf9656de1b7f56720","downloaded_from":"2026-09-10T01:07:22.977Z","last_downloaded_at":"2026-09-10T01:07:22.977Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147483413","source_sha256":"2cf89b521181ca79e4d4c82de98bf11427661088d1c26e6e7b235e49bbfdd1c7"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:b3f8c843786d422287bf456f998c32fe5db6ac7e47479a52f8cb3786fcc1425e","downloaded_from":"2026-09-10T01:07:22.977Z","last_downloaded_at":"2026-09-10T01:07:22.977Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147483413","source_sha256":"2cf89b521181ca79e4d4c82de98bf11427661088d1c26e6e7b235e49bbfdd1c7"}},{"block":null,"heading":"Entities","paragraphs":[{"citation":"720-20-15-2","para":"15-2","html":"
The guidance in this Subtopic applies to all entities.
","snippet":"The guidance in this Subtopic applies to all entities.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:f2d09d8c7c9c82f2244abf222b643204d2ffbbe01f75a983ede73aba974ba908","downloaded_from":"2026-09-10T01:07:22.977Z","last_downloaded_at":"2026-09-10T01:07:22.977Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147483413","source_sha256":"2cf89b521181ca79e4d4c82de98bf11427661088d1c26e6e7b235e49bbfdd1c7"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:04276724dd242b94fe4228b37fd2ae9b7396e7507c40efbb63b9f7ccf1f1acaf","downloaded_from":"2026-09-10T01:07:22.977Z","last_downloaded_at":"2026-09-10T01:07:22.977Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147483413","source_sha256":"2cf89b521181ca79e4d4c82de98bf11427661088d1c26e6e7b235e49bbfdd1c7"}},{"block":"Retroactive Contracts","heading":"Overall Guidance","paragraphs":[{"citation":"720-20-15-3","para":"15-3","html":"
The Retroactive Contracts Subsections follow the same Scope and Scope Exceptions as outlined in the General Subsection of this Subtopic, see paragraph 720-20-15-1, with specific entity and transaction qualifications noted below.
","snippet":"The Retroactive Contracts Subsections follow the same Scope and Scope Exceptions as outlined in the General Subsection of this Subtopic, see paragraph 720-20-15-1, with specific entity and transaction qualifications note…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:aa42395ae7f26b9988df19c7594e049a7723e44a6a59d37e198d01e48346faa2","downloaded_from":"2026-09-10T01:07:22.977Z","last_downloaded_at":"2026-09-10T01:07:22.977Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147483413","source_sha256":"2cf89b521181ca79e4d4c82de98bf11427661088d1c26e6e7b235e49bbfdd1c7"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:4ccc4bc60d7357115384e9b7ff8a9eeb8b893b9e817b5c4132d5f01674fa62fd","downloaded_from":"2026-09-10T01:07:22.977Z","last_downloaded_at":"2026-09-10T01:07:22.977Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147483413","source_sha256":"2cf89b521181ca79e4d4c82de98bf11427661088d1c26e6e7b235e49bbfdd1c7"}},{"block":"Retroactive Contracts","heading":"Entities","paragraphs":[{"citation":"720-20-15-4","para":"15-4","html":"
The guidance in the Retroactive Contracts Subsections applies to all entities that enter into retroactive insurance contracts.
","snippet":"The guidance in the Retroactive Contracts Subsections applies to all entities that enter into retroactive insurance contracts.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:a4ab70952e208333930bc6079794a8df9c6d608ba526188019ec52541637a26e","downloaded_from":"2026-09-10T01:07:22.977Z","last_downloaded_at":"2026-09-10T01:07:22.977Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147483413","source_sha256":"2cf89b521181ca79e4d4c82de98bf11427661088d1c26e6e7b235e49bbfdd1c7"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:945ee2be9e2f4b5a275f617636f7bb6e739deca92d4de48a525f5b9236cf49e1","downloaded_from":"2026-09-10T01:07:22.977Z","last_downloaded_at":"2026-09-10T01:07:22.977Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147483413","source_sha256":"2cf89b521181ca79e4d4c82de98bf11427661088d1c26e6e7b235e49bbfdd1c7"}},{"block":"Retroactive Contracts","heading":"Transactions","paragraphs":[{"citation":"720-20-15-5","para":"15-5","html":"
The guidance in the Retroactive Contracts Subsections applies to the following transactions and activities:
  1. a
    Those that meet the indemnification against loss or liability conditions of Section 720-20-25-1
  2. b
    Those that provide indemnification against loss or liability relating to liabilities that have been incurred as a result of a past event, for example, environmental remediation liabilities (see Subtopic 410-30).
","snippet":"The guidance in the Retroactive Contracts Subsections applies to the following transactions and activities:\n(a) Those that meet the indemnification against loss or liability conditions of Section 720-20-25-1\n(b) Those th…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:16f0cb07f67b1dd70a069e301a834f93382140e0d4973587ad84ba9c7baf9de6","downloaded_from":"2026-09-10T01:07:22.977Z","last_downloaded_at":"2026-09-10T01:07:22.977Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147483413","source_sha256":"2cf89b521181ca79e4d4c82de98bf11427661088d1c26e6e7b235e49bbfdd1c7"}},{"citation":"720-20-15-6","para":"15-6","html":"
The guidance in the Retroactive Contracts Subsections does not apply to the following transactions and activities:
  1. a
    Those that legally extinguish the entity's liability
  2. b
    Reinsurance transactions (see Subtopic 944-20 for guidance on the accounting by insurance entities for reinsurance contracts).
","snippet":"The guidance in the Retroactive Contracts Subsections does not apply to the following transactions and activities:\n(a) Those that legally extinguish the entity's liability\n(b) Reinsurance transactions (see Subtopic 944-2…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:17e71650a96739e5c6922aed4b6423941826b1ca49d35f4c3216ae1dcd8987f7","downloaded_from":"2026-09-10T01:07:22.977Z","last_downloaded_at":"2026-09-10T01:07:22.977Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147483413","source_sha256":"2cf89b521181ca79e4d4c82de98bf11427661088d1c26e6e7b235e49bbfdd1c7"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:8c929a5e67242f48d3bbddd8b42def3bb72b8dda81220b0a71493c1529e0bddf","downloaded_from":"2026-09-10T01:07:22.977Z","last_downloaded_at":"2026-09-10T01:07:22.977Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147483413","source_sha256":"2cf89b521181ca79e4d4c82de98bf11427661088d1c26e6e7b235e49bbfdd1c7"}},{"block":"Claims-Made Contracts","heading":"Overall Guidance","paragraphs":[{"citation":"720-20-15-7","para":"15-7","html":"
The Claims-Made Contracts Subsections follow the same Scope and Scope Exceptions as outlined in the General Subsection of this Subtopic, see paragraph 720-20-15-1, with specific transaction exceptions noted below.
","snippet":"The Claims-Made Contracts Subsections follow the same Scope and Scope Exceptions as outlined in the General Subsection of this Subtopic, see paragraph 720-20-15-1, with specific transaction exceptions noted below.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:8789686d28516e1c940f21a4c08fcbf75bfdf4141466c10efd77e24a48e54000","downloaded_from":"2026-09-10T01:07:22.977Z","last_downloaded_at":"2026-09-10T01:07:22.977Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147483413","source_sha256":"2cf89b521181ca79e4d4c82de98bf11427661088d1c26e6e7b235e49bbfdd1c7"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:ac208a30e268f5e721c10b03b913b7d99a1ecd4d6ac4c0c02b97e24d57351b5c","downloaded_from":"2026-09-10T01:07:22.977Z","last_downloaded_at":"2026-09-10T01:07:22.977Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147483413","source_sha256":"2cf89b521181ca79e4d4c82de98bf11427661088d1c26e6e7b235e49bbfdd1c7"}},{"block":"Claims-Made Contracts","heading":"Transactions","paragraphs":[{"citation":"720-20-15-8","para":"15-8","html":"
The guidance in the Claims-Made Contracts Subsections does not apply to reinsurance transactions (see the Reinsurance Subsections of Topic 944 for guidance on the accounting by insurance entities for reinsurance contracts).
","snippet":"The guidance in the Claims-Made Contracts Subsections does not apply to reinsurance transactions (see the Reinsurance Subsections of Topic 944 for guidance on the accounting by insurance entities for reinsurance contract…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:66a9581ac02a381ccba6b484408dc843ed10a8bd5352efaf0f4f66bd2aeaeb3b","downloaded_from":"2026-09-10T01:07:22.977Z","last_downloaded_at":"2026-09-10T01:07:22.977Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147483413","source_sha256":"2cf89b521181ca79e4d4c82de98bf11427661088d1c26e6e7b235e49bbfdd1c7"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:47f048178789c88ee63316b19ecc8e4cb90ccb6af373285a954a9d14b4e4ae44","downloaded_from":"2026-09-10T01:07:22.977Z","last_downloaded_at":"2026-09-10T01:07:22.977Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147483413","source_sha256":"2cf89b521181ca79e4d4c82de98bf11427661088d1c26e6e7b235e49bbfdd1c7"}},{"block":"Multiple-Year Retrospectively Rated Contracts","heading":"Overall Guidance","paragraphs":[{"citation":"720-20-15-9","para":"15-9","html":"
The Multiple-Year Retrospectively Rated Contracts Subsections follow the same Scope and Scope Exceptions as outlined in the General Subsection of this Subtopic, see paragraph 720-20-15-1, with specific transaction exceptions noted below.
","snippet":"The Multiple-Year Retrospectively Rated Contracts Subsections follow the same Scope and Scope Exceptions as outlined in the General Subsection of this Subtopic, see paragraph 720-20-15-1, with specific transaction except…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:ea53a2375880cd06556ec2e139a409ed9c96493d06abaef7f465add03b085b51","downloaded_from":"2026-09-10T01:07:22.977Z","last_downloaded_at":"2026-09-10T01:07:22.977Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147483413","source_sha256":"2cf89b521181ca79e4d4c82de98bf11427661088d1c26e6e7b235e49bbfdd1c7"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:c421cefe5d7fd8cf91972f1a4db5ea2650b291b2f6f39edb5d1b7fbfacfb293f","downloaded_from":"2026-09-10T01:07:22.977Z","last_downloaded_at":"2026-09-10T01:07:22.977Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147483413","source_sha256":"2cf89b521181ca79e4d4c82de98bf11427661088d1c26e6e7b235e49bbfdd1c7"}},{"block":"Multiple-Year Retrospectively Rated Contracts","heading":"Transactions","paragraphs":[{"citation":"720-20-15-10","para":"15-10","html":"
The guidance in the Multiple-Year Retrospectively Rated Contracts Subsections does not apply to the following transactions and activities:
  1. a
    A retrospectively rated insurance contract that is not a multiple-year contract or that could be cancelled by either party without further obligation.
","snippet":"The guidance in the Multiple-Year Retrospectively Rated Contracts Subsections does not apply to the following transactions and activities:\n(a) A retrospectively rated insurance contract that is not a multiple-year contra…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:07b75bdd1d182a0f2c0422d726205626ff6399b59969904dd14f53e86960bda8","downloaded_from":"2026-09-10T01:07:22.977Z","last_downloaded_at":"2026-09-10T01:07:22.977Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147483413","source_sha256":"2cf89b521181ca79e4d4c82de98bf11427661088d1c26e6e7b235e49bbfdd1c7"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:12784d6b3f0b7fe70d5c32f0b18d4d3252b2934e014b61c2ca98770a4be3319a","downloaded_from":"2026-09-10T01:07:22.977Z","last_downloaded_at":"2026-09-10T01:07:22.977Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147483413","source_sha256":"2cf89b521181ca79e4d4c82de98bf11427661088d1c26e6e7b235e49bbfdd1c7"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:bc61da2cecd989664a5fbaf3d83083ae57d319e6a4fa012cd2f6687f5cb52849","downloaded_from":"2026-09-10T01:07:22.977Z","last_downloaded_at":"2026-09-10T01:07:22.977Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147483413","source_sha256":"2cf89b521181ca79e4d4c82de98bf11427661088d1c26e6e7b235e49bbfdd1c7"}},"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:bc61da2cecd989664a5fbaf3d83083ae57d319e6a4fa012cd2f6687f5cb52849","downloaded_from":"2026-09-10T01:07:22.977Z","last_downloaded_at":"2026-09-10T01:07:22.977Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147483413","source_sha256":"2cf89b521181ca79e4d4c82de98bf11427661088d1c26e6e7b235e49bbfdd1c7"}}