The ratings firm said that although its credit analysis focuses on the financial condition of a company regardless of accounting, changes like a new format for the balance sheet, income statement or disclosures "may bring to light information that we would need to consider in our analysis," S&P said.

Earlier this year, an investor's note from Sandler O'Neill & Partners said the proposed new standard would increase earnings volatility. The firm said it preferred the current generally accepted accounting principles (GAAP) standards.

The IASB model "is an improvement to the current accounting for insurance contracts," S&P said.

S&P went on to say that historical trend analysis could be difficult and maybe impossible because the accounting changes are "so pervasive."

Users of the new accounting standards would recognize earlier when losses will occur and they will gain insight about management's perception of risk, including how a company manages and mitigates risk, S&P said. This will allow users to "perform peer comparisons across insurers on their approach to managing and mitigating insurance risk," S&P noted, adding that it welcomes a common set of accounting standards for peer comparisons as global ratings agency.

Under the new model the income statement would no longer include premiums, claims or expenses but will include a breakdown of underwriting margin, gains and losses, inception, changes in experience, and changes in estimates, S&P said.

The IASB and FASB have a commitment to complete the insurance contracts project by June 2011, with an effective date of 2013 or 2014.

Though European insurers would benefit if the new accounting requirements took effect at the same time as Solvency II at the start of 2013, the same does not apply to U.S. insurers. State insurance regulators oversee insurance companies, and regulators have no commitment to adopt a method like Solvency II, S&P said.