Bring outside information (inflation indices, tort reform, attorney involvement) into a reserve analysis when internal history alone is not enough.
Free CAS Exam 5 (Basic Ratemaking and Reserving) lesson in Estimating Claim Liabilities. 18 min read, ~2,660 words.
Bring in outside data when internal history is thin, volatile, or broken by a structural change (legal, economic, or operational). Inflation indices (CPI, medical CPI, wage) restate old claim costs to a common current cost level before you fit a trend. Match the index to the loss: medical severity trends...
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What this lesson covers
- Content
- Example 1
- Example 2
- Example 3
- Common Mistakes
- Check Your Understanding
- Exam Shortcuts
Learning objectives
- B20
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