Estimate unpaid losses with the development (chain ladder), case outstanding development, expected claims, Bornhuetter-Ferguson, Cape Cod, frequency-severity, Berquist-Sherman, and Benktander techniques, and judge when each fits.
Free CAS Exam 5 (Basic Ratemaking and Reserving) lesson in Estimating Claim Liabilities. 29 min read, ~4,316 words.
Chain ladder ultimate equals latest cumulative losses times the cumulative development factor (CDF); fully responsive, unstable for green years. Expected claims ultimate equals premium times an a priori loss ratio; ignores actual emergence, best for immature or thin years. Bornhuetter-Ferguson ultimate equals reported losses plus expected losses times the unreported...
Read the full lesson, free →
Worked examples and practice. Free with a free account, no card.
What this lesson covers
- Content
- Example 1
- Example 2
- Example 3
- Example 4
- Example 5
- Common Mistakes
- Check Your Understanding
- Exam Shortcuts
Learning objectives
- B9
Browse all free Exam 5 lessons or jump into free Exam 5 practice questions.