Loss Reserve distributions, Best estimate Ranges, Point Estimates plus reserve margins. Yeah, but I have to book a number that many people care about. Which X marks the spot?

This session is intended to be an interactive audience/panelist discussion on the theoretical and practical relationships of determining reserve distributions and ultimately considerations of the following:

Given that you have determined a probability distribution of reserves by line of business and in total, this session now discusses where we go from here:

• What is my estimate range?


• What is management’s best estimate?


• What number do we book gross and net?


• What number do we book by line of business?


• Any number in a reasonable range works right?


To add complication to our analysis we also get other people who care.



• Yeah but SBU#2’s incentive compensation is affected if we book to high in the range.


• Yeah but the CEO is targeting a current year combined ratio of 104.2. My best estimate is at 105.7. If I lower my estimate, I’m still in range of best estimate, so I’m ok right?


• Yeah but we don’t; have to worry about ranges any more if there is a prescribed method booking a point estimate plus prescribed reserve margin. Right? Or do we now have a new pre-scribed “point estimate” to debate about.


You get the message. We’ve all been there Join us for an active discussion.