A practical look at why every reserving actuary should implement ranges as standard reserving practice, and some simple real-life applications in Excel to drive home the point.
The first panelist will start by listing reasons for estimating ranges, summarizing reasons he has heard for not providing a range, and reviewing what the Actuarial Standards of Practice have to say about the matter. He will then provide a simple example in Excel, showing the nuts and bolts of applying the Mack Method to an incurred loss triangle.
The second panelist will explain the basic stochastic terminology in layman's terms. The session will define the various types of risks measured in stochastic analysis and provide a basic understanding of the underlying ideas and concepts behind the most popular stochastic models and methods. Moving from theory to practice, the session will conclude with a walk-through of the Bootstrapping Method implemented in Excel.