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Loss DEvelopment Factors LDF

Loss development factors (LDF)

May 18, 2019
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Loss development factors or LDFs are used in insurance pricing and reserving to adjust claims to their projected ultimate level i.e to Ultimate Claims. Insurance claims, especially in long-tailed lines such as liability insurance or Motor TP, are often not paid out immediately. Claims adjusters set initial case reserves for claims; …

Bornhuetter Ferguson Technique: If the development is maturely immature.

May 17, 2019
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What is Bornhuetter Ferguson Technique The Bornhuetter Ferguson technique (BF Method) is a method for calculating an estimate of an insurance company’s losses. The Bornhuetter Ferguson technique, also called the Bornhuetter Ferguson method (BF Method) , estimates incurred but not yet reported (IBNR) losses for a …