An estimate of the amount of money the insurer expects to pay in the future for losses that have
already occurred and been reported, but are not yet settled. - Answer-Loss reserve
The expense that an insurer incurs to investigate, defend, and settle claims according to the terms
specified in the...
AIAF 114 2.0 An estimate of the amount of money the insurer expects to pay in the future for losses that have already occurred and been reported, but are not yet settled. - Answer -Loss reserve The expense that an insurer incurs to investigate, defend, and settle claims according to the terms specified in the insurance policy. - Answer -Loss adjustment expense (LAE) The expense an insurer incurs to investigate, defend, and settle claims that are associated with a specific claim. - Answer -Allocated loss adjustment expense (ALAE) Loss adjustment expense that cannot be readily associated with a specific claim. - Answer -
Unallocated loss adjustment expense (ULAE) Estimates of the future expense that an insurer expects to incur to investigate, defend, and settle claims for losses that have already occurred. - Answer -Loss adjustment expense reserves Losses that have been paid to, or on behalf of, insureds during a given period. - Answer -Paid losses The losses that have occurred during a specific period, no matter when claims resulting from the losses are paid. - Answer -Incurred losses A reserve established for losses that reasonably can be assumed to have been incurred but not yet reported. - Answer -Incurred but not reported (IBNR) reserves A method of organizing ratemaking statistics that uses incurred losses for an accident year, which consist of all losses related to claims arising from accidents that occur during the year, and that estimates earned premiums by formulas from accounting rec ords. - Answer -Accident -year method The final paid amount for all losses in an accident year. - Answer -Ultimate loss The increase or decrease of incurred losses over time. - Answer -Loss development A loss reserve assigned to an individual claim. - Answer -Case reserve Reserves established for the settlement of an entire group of claims. - Answer -Bulk reserves A method to establish a case loss reserve based largely on experience with similar claims. - Answer -
Judgment method A method to establish a case reserve by using an average amount for specific categories of claims. - Answer -Average method A case reserving method that establishes an average amount for all claims that have similar characteristics in terms of the claimant's age, health, and marital status. - Answer -Tabular method A factor that is applied to the most recent estimate of incurred losses for a specific accident year to estimate the ultimate incurred loss for that year. - Answer -Ultimate loss development factor The transfer of insurance risk from one insurer to another through a contractual agreement under which one insurer (the reinsurer) agrees, in return for a reinsurance premium, to indemnify another insurer (the primary insurer) for some or all of the financ ial consequences of certain loss exposures covered by the primary's insurance policies. - Answer -Reinsurance In reinsurance, the insurer that transfers or cedes all or part of the insurance risk it has assumed to another insurer in a contractual arrangement. - Answer -Primary insurer The insurer that assumes some or all of the potential costs of insured loss exposures of the primary insurer in a reinsurance contractual agreement. - Answer -Reinsurer Contract between the primary insurer and reinsurer that stipulates the form of reinsurance and the type of accounts to be reinsured. - Answer -Reinsurance agreement Uncertainty about the adequacy of insurance premiums to pay losses. - Answer -Insurance risk The amount retained by the primary insurer in the reinsurance transaction. - Answer -Retention The consideration paid by the primary insurer to the reinsurer for assuming some or all of the primary insurer's insurance risk. - Answer -Reinsurance premium
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