P
phos2
Member
I am looking at chapter 20 - page 18/19/20:
The IBNER development from the cedant’s large loss experience can be derived by arranging historical loss developments into development triangles aggregated by year and then comparing the (trended) incurred at time t for losses for year n reported at time t, with the (trended) incurred at time t + 1 for losses for year n reported at time t.
Could someone explain by what is mean by "year" in this case? Can it be underwriting year/accident year/reporting year?
The reason I ask is because the SP7 notes say that IBNER adjustments are made by grouping the claims by reporting year and make no mention at all of this t/t+1 distinction. Are the two methods equivalent?
The IBNER development from the cedant’s large loss experience can be derived by arranging historical loss developments into development triangles aggregated by year and then comparing the (trended) incurred at time t for losses for year n reported at time t, with the (trended) incurred at time t + 1 for losses for year n reported at time t.
Could someone explain by what is mean by "year" in this case? Can it be underwriting year/accident year/reporting year?
The reason I ask is because the SP7 notes say that IBNER adjustments are made by grouping the claims by reporting year and make no mention at all of this t/t+1 distinction. Are the two methods equivalent?