Fall 2018 #14b
Here, they have [incurred loss = paid loss + change in unpaid loss]. I feel like I've always seen [incurred loss = paid loss + change in case reserves]. Is the change in unpaid what should always be used?
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Here, they have [incurred loss = paid loss + change in unpaid loss]. I feel like I've always seen [incurred loss = paid loss + change in case reserves]. Is the change in unpaid what should always be used?
Comments
In the Annual Statement context, "incurred" is generally defined as paid loss + change in unpaid loss. Elsewhere, in actuarial analysis, "incurred" usually means paid loss + change in case reserves.