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Actuarial notation is a shorthand method to allow actuaries to record mathematical formulas that deal with interest rates and life tables. Traditional notation uses a halo system , where symbols are placed as superscript or subscript before or after the main letter.
Ultimate loss amounts are necessary for determining an insurance company's carried reserves. They are also useful for determining adequate insurance premiums, when loss experience is used as a rating factor [4] [5] [6] Loss development factors are used in all triangular methods of loss reserving, [7] such as the chain-ladder method.
It is primarily used in the property and casualty [5] [9] and health insurance [2] fields. Generally considered a blend of the chain-ladder and expected claims loss reserving methods, [ 2 ] [ 8 ] [ 10 ] the Bornhuetter–Ferguson method uses both reported or paid losses as well as an a priori expected loss ratio to arrive at an ultimate loss ...
The chain-ladder or development [1] method is a prominent [2] [3] actuarial loss reserving technique. The chain-ladder method is used in both the property and casualty [1] [4] and health insurance [5] fields. Its intent is to estimate incurred but not reported claims and project ultimate loss amounts. [5]
Table 1 (Males) and Table 2 (Females) are for life expectancy and loss for life. Tables 3 to 14 are for loss of earnings up to various retirement ages. Tables 15 to 26 are for loss of pension from various retirement ages. Table 27 is for discounting for a time in the future and Table 28 is for a recurring loss over a period of time. [9]
This page is concerned with the stochastic modelling as applied to the insurance industry. For other stochastic modelling applications, please see Monte Carlo method and Stochastic asset models. For mathematical definition, please see Stochastic process. "Stochastic" means being or having a random variable.
Typically burning cost is the estimated cost of claims in the forthcoming insurance period, calculated from previous years' experience adjusted for changes in the numbers insured, the nature of cover and medical inflation. Historical (aggregate) data extraction; Adjustments to obtain 'as if' data:
In insurance, an actuarial reserve is a reserve set aside for future insurance liabilities. It is generally equal to the actuarial present value of the future cash flows of a contingent event. In the insurance context an actuarial reserve is the present value of the future cash flows of an insurance policy and the total liability of the insurer ...