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Terms

Short and Long Tailed

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Somehow, Short-tailed and long-tailed suggest only if the claims are reported and settled quickly or are delayed. But these are used everywhere in General Insurance.

Short and Long tailed is an important concept there is not an exercise in which we are not going to use it, consider pricing, reserving or even Asset Liability Management.

Short Tailed

Short tailed means that the claims are generally reported quickly and settled quickly by the insurer.

Long Tailed

Long tailed means that there is a sizeable proportion of total claim payments that takes a long time to be reported and/or a long time for the insurer to settle.


Example of Short and Long Tailed

No exercise available

 


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Mayank Goyal
Redmond Lover(Microsoft), London Dreamer(Actuary), California Thinker(Entrepreneur). Actuarial Science, Blogger, Web Developing, Winphan India, App development, Social Media Managing, Event Managing & bla bla bla.

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Actuarial Reserving

  • Actuarial GI Reserving
  • GI Reserving HOME
  • Introduction
  • Run Off Triangles in GI
  • Claim Reserves
    • IBNR Reserves
    • Outstanding Reserves
    • Other Reserves
  • Terms to Understand
    • Short and Long Tailed
    • Earned Premium
    • Incurred Claims
    • Loss Ratio
    • Development Factors
  • Methodology for GI Reserving
    • Selecting DFs
    • Cumulative Development factors (CDFs)
    • Reserving methods in GI
      • Chain Ladder method – CLM
      • Bornhuetter Ferguson Method
      • Expected Claims Method

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