Reply To: IBNR Reserves
tanmay
tac wrote:
Quote:
What are IBNR Reserves?
How are they useful in General Insurance?
Incurred But Not Reported or IBNR reserves are a part of claims reserves estimated by insurers for reporting on their financial statements. Claims reserves are estimates of claims that have occurred on or before the financial statement report date but which have yet to be paid.
This a current liability that has to be reported regularly on the insurer’s financial statements even though the actual final settlement cost of the claims may be unknown to the entity at that date. Accuracy of these claims reserves estimates is important to the insurer for a number of reasons. It impacts the insurers:
What if some Inaccurate measures are made to calculate IBNR Reserves?