Introduction To Ratemaking And Loss Reserving For Property And Casualty Insurance • Best & Deluxe

Introduction to Ratemaking and Loss Reserving for Property and Casualty Insurance

4.3 Data Setup – The Loss Development Triangle

• Accident year vs. development year vs. calendar year.
• How to read a triangle (incremental or cumulative).
• Need for paid loss and incurred loss triangles.

9. Recommended Next Steps

To deepen your knowledge:

C. Risk Load (Profit & Contingencies)

Consider a general liability policy for a manufacturing company, effective January 1, 2023. A worker is exposed to a toxic chemical. The worker develops a disease in 2024, reports the claim in 2025, and a lawsuit settles in 2027. This creates a tail—the time lag between the policy effective date and the final claim payment. Introduction to Ratemaking and Loss Reserving for Property