Untitled Document
BES pension funds now as popular an investment as term bank deposits
Circulatory system disease and cancer the biggest killers in Turkey
Takaful insurance trade association formed
Staggered start to Automatic Enrollment
Tourism crisis and coup attempt hit unemployment
Demir Hayat now owned by EMF New Europe Insurance Fund
Treasury reminds employers of their responsibilities under Automatic Enrollment
Nothing's certain except death and taxes
Government's plans for our sector in 2017
Government rethinking their plans for mandatory private pensions
Untitled Document population premium waiver Aegon 2012 Katılım Hayat ve Emeklilik death 2023 health Islamic finance Asya Emeklilik
Untitled Document
IBNR: Changes from 30 Sept 2010


 A new directive from the Treasury gives management the discretion to choose a best estimate for their IBNR (estimate of Incurred But Not yet Reported claims reserve) from a range of reasonable values.

Broadly speaking, five different methods are prescribed:

  • Standard Chain Ladder
  • Naive Loss Ratio
  • Cape Cod
  • Frequency/Severity
  • Munich Chain

The definitions of these, and spreadsheets to be used, are provided to companies by the Treasury via the SGS electronic system. There has been a lot of debate in the industry as to which should beused. In fact one-size cannot fit all, due to differences in claims profiles between branches and between companies within branches.

Management can choose, during Q3 and Q4 which method suits their data best; this choice can be made per branch, but watch out - once made you have to stick to your choice for 3 years!

Some advice on choosing the best estimate method

Tags: claims | IBNR | reserves |
No comments have been made on this article yet..

www.turkeyinsurance.info © Marion James 2014 All rights reserved.