# ASC 944-50-30: Financial Services—Insurance — Policyholder Dividends — 30 Initial Measurement

Source: FASB Accounting Standards Codification, Basic View

[Read online](https://asc.understandingaccounting.org/asc/944/50/#30-initial-measurement)

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## ASC 944-50-30: 30 Initial Measurement

[Read section](https://asc.understandingaccounting.org/asc/944/50/#30-initial-measurement)

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#### Participating Contracts

##### [944-50-30-1](https://asc.understandingaccounting.org/asc/944/50/#944-50-30-1)

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Policyholder dividends accrued under paragraph [944-50-25-1](https://asc.understandingaccounting.org/asc/944/50/#944-50-25-1) shall be measured using an estimate of the amount to be paid.

##### [944-50-30-2](https://asc.understandingaccounting.org/asc/944/50/#944-50-30-2)

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Income-based dividend provisions for participating contracts other than those long-duration participating life insurance contracts that meet the criteria in paragraph [944-20-15-3](https://asc.understandingaccounting.org/asc/944/20/#944-20-15-3), shall be based on net income that includes adjustments between general-purpose and statutory financial statements that will reverse and enter into future calculations of the dividend provision.

##### [944-50-30-3](https://asc.understandingaccounting.org/asc/944/50/#944-50-30-3)

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Policyholder dividends shall be recognized over the premium-paying periods under paragraph [944-50-25-3](https://asc.understandingaccounting.org/asc/944/50/#944-50-25-3) based on dividends anticipated or intended in determining gross premiums or as shown in published dividend illustrations at the date insurance contracts are made.

### Long-Duration Contracts

#### Certain Long-Duration Participating Life Insurance Contracts

##### [944-50-30-4](https://asc.understandingaccounting.org/asc/944/50/#944-50-30-4)

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The expense recognized under paragraph [944-50-25-4](https://asc.understandingaccounting.org/asc/944/50/#944-50-25-4) for [annual policyholder dividends](https://asc.understandingaccounting.org/glossary/a/#annual-policyholder-dividends "Amount of dividends to policyholders calculated and paid each year, representing the policyholders' share of divisible surplus.") shall be based on estimates of amounts incurred for the policies in effect during the period.

##### [944-50-30-5](https://asc.understandingaccounting.org/asc/944/50/#944-50-30-5)

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For example, if a policy has an anniversary date of June 30, at which time annual dividends are paid, at December 31, 19X1, dividends should be accrued for the period July 1, 19X1, through December 31, 19X1.