AS463_Lec04 - 1 ACTSC 463/863 Property and Casualty Loss...

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Unformatted text preview: 1 ACTSC 463/863 Property and Casualty Loss Reserving 2 Case Outstanding Development Technique 3 Case Outstanding Development > Attempts to develop ultimate incremental claim payments based on historic levels of case reserve adequacy > Assumptions Similar to other development techniques Applies to claims that have already been reported (this causes problems) 4 Case Outstanding Development > Steps Derive triangles of case outstanding and incremental paid loss Calculate ratios of incremental paid on reserve i.e. ?? ? ?? 12 Calculate ratios of case outstanding to previous case outstanding i.e. ? ?? ? ?? 12 Fill in lower triangle of case outstanding Fill in lower triangle of incremental paid Cumulate to derive ultimate paid 5 Example Case Outstanding Accident Year 12 24 36 48 60 72 84 96 108 120 2000 16,089 23,021 25,961 23,859 19,506 13,693 10,015 7,938 2,818 2,146 2001 21,370 29,336 37,858 30,702 27,805 24,360 15,624 9,260 4,066 2002 21,303 30,972 38,809 36,162 30,182 25,943 15,411 10,921 2003 17,389 30,869 40,501 46,905 34,276 19,900 12,516 2004 18,557 32,658 47,353 41,903 32,549 19,720 2005 30,307 49,650 52,599 51,055 34,609 2006 35,790 45,042 60,086 57,356 2007 29,261 51,247 63,572 2008 36,146 60,792 2009 28,456 Case Outstanding to Previous Case Outstanding Accident Year 12 24 36 48 60 72 84 96 108 120 To Ult 2000 143.1% 112.8% 91.9% 81.8% 70.2% 73.1% 79.3% 35.5% 76.1% 2001 137.3% 129.1% 81.1% 90.6% 87.6% 64.1% 59.3% 43.9% 2002 145.4% 125.3% 93.2% 83.5% 86.0% 59.4% 70.9% 2003 177.5% 131.2% 115.8% 73.1% 58.1% 62.9% 2004 176.0% 145.0% 88.5% 77.7% 60.6% 2005 163.8% 105.9% 97.1% 67.8% 2006 125.9% 133.4% 95.5% 2007 175.1% 124.1% 2008 168.2% Select 156.9% 125.8% 94.7% 79.1% 72.5% 64.9% 69.8% 39.7% 76.1% 0.0% 6 Example Case Outstanding Accident Year 12 24 36 48 60 72 84 96 108 120 2000 16,089 23,021 25,961 23,859 19,506 13,693 10,015 7,938 2,818 2,146 2001 21,370 29,336 37,858 30,702 27,805 24,360 15,624 9,260 4,066 3,096 2002 21,303 30,972 38,809 36,162 30,182 25,943 15,411 10,921 4,336 3,302 2003 17,389 30,869 40,501 46,905 34,276 19,900 12,516 8,736 3,469 2,641 2004 18,557 32,658 47,353 41,903 32,549 19,720 12,797 8,933 3,546 2,700 2005 30,307 49,650 52,599 51,055 34,609 25,085 16,279 11,363 4,511 3,435 2006 35,790 45,042 60,086 57,356 45,342 32,865 21,327 14,886 5,910 4,500 2007 29,261 51,247 63,572 60,213 47,600 34,502 22,389 15,628 6,205 4,724 2008 36,146 60,792 76,501 72,458 57,281 41,518 26,943 18,806 7,467 5,685 2009 28,456 44,653 56,191 53,221 42,073 30,495 19,790 13,813 5,484 4,176 Case Outstanding to Previous Case Outstanding Accident Year 12 24 36 48 60 72 84 96 108 120 To Ult 2000 143.1% 112.8% 91.9% 81.8% 70.2% 73.1% 79.3% 35.5% 76.1% 2001 137.3% 129.1% 81.1% 90.6% 87.6% 64.1% 59.3% 43.9% 2002 145.4% 125.3% 93.2% 83.5% 86.0% 59.4% 70.9% 2003 177.5% 131.2% 115.8% 73.1% 58.1% 62.9%62....
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AS463_Lec04 - 1 ACTSC 463/863 Property and Casualty Loss...

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