September 11, 2001 Kathy Barnes, FCAS, MAAA Loss Development in Massachusetts Private Passenger Automobile Casualty Loss Reserving Seminar - New Orleans.

Slides:



Advertisements
Similar presentations
Assignment Nine Actuarial Operations.
Advertisements

1 Math 479 / 568 Casualty Actuarial Mathematics Fall 2014 University of Illinois at Urbana-Champaign Professor Rick Gorvett Session 4: Loss Reserving I.
Reserve Variability Modeling: Correlation 2007 Casualty Loss Reserve Seminar San Diego, California September 10-11, 2007 Mark R. Shapland, FCAS, ASA, MAAA.
1 Ken Fikes, FCAS, MAAA Introduction to Casualty Actuarial Science November 2005.
1 Ken Fikes, FCAS, MAAA Introduction to Casualty Actuarial Science Ken Fikes, FCAS, MAAA Director of Property & Casualty
Reserving for Title Insurance 2004 Casualty Loss Reserve Seminar Paul J. Struzzieri, FCAS Milliman, Inc. September 14, 2004.
Industry Reserve Adequacy 1998 CLRS, Philadelphia Todd Hess, FCAS, MAAA Underwriters Reinsurance Company.
Loss Reserving in Argentina, Brazil and Mexico Eduardo Esteva New Orleans, Louisiana September 11, 2001.
Introduction to Reinsurance Reserving Casualty Loss Reserve Seminar Washington, D.C. September 23, 2002 Bruce D. Fell, FCAS, MAAA Am-Re Consultants, Inc.
September 28–29, 1998 Philadelphia, Pennsylvania Lisa G. Chanzit Patrick R. Newlin Ruth E. Winnicki Actuarial & Claims — Strange Partners? Casualty Loss.
Loss Reserving Anatomy of a claim 12/15/99 Auto accident 12/20/99 Insured reports accident to agent 1/7/00 Claim recorded 2/3/00 $10,000 reserve set 1/8/01.
Senate Bill No. 863 Cost Monitoring – Current Update W o r k e r s’ C o m p e n s a t i o n I n s u r a n c e R a t i n g B u r e a u o f C a l i f o r.
1999 CLRS Intermediate Case Study Discussion Material For GL Insurance Company.
PwC CAS Fair Value Project Casualty Actuaries in Europe Spring Meeting 23 April 2004 E. Daniel Thomas (1)
Non-Life Loss Reserving Practices and Documentation IAIS – ASSAL Training Seminar April 29, 2009 David Oakden.
2005 CLRS September 2005 Boston, Massachusetts
© 2005 Towers Perrin September 12, 2005 Michael Angelina, ACAS, MAAA – Endurance Specialty Holdings Kevin Downs, FCAS, MAAA – Towers Perrin Bruce D. Fell,
Ab Rate Monitoring Steven Petlick Seminar on Reinsurance May 20, 2008.
1999 CASUALTY LOSS RESERVE SEMINAR Intermediate Track II - Techniques
1 CLRS Basic Track I Basic Track I 1998 CLRS September 28, 1998 Philadelphia, Pennsylvania.
Reconciliation and the Opining Actuary Wendy Germani, FCAS MAAA Holmes Gwynn, ACAS MAAA Presented CLRS – Fall 2004.
CLOSING THE BOOKS WITH PARTIAL INFORMATION By Joseph Marker, FCAS, MAAA CLRS, Chicago, IL, September 2003.
Market Cycle Update Personal Lines Greg Ciezadlo, FCAS, MAAA Farmers Insurance Group Casualty Actuarial Society Spring Meeting 2002 – San Diego, California.
CASUALTY LOSS RESERVE SEMINAR HOW A.M. BEST EVALUATES RESERVE ADEQUACY Matthew C. Mosher Managing Actuary September 28, Meeting.
Milliman Package Policy Reserving Casualty Loss Reserve Seminar Prepared by: Brian Z. Brown, FCAS, MAAA Consulting Actuary Milliman, Inc. Monday – September.
Thomas L. Ghezzi, FCAS, MAAA 2003 CAS Seminar on Reinsurance Commercial Umbrella This document was designed for discussion purposes only. It is incomplete,
“The Effect of Changing Exposure Levels on Calendar Year Loss Trends” by Chris Styrsky, FCAS, MAAA Ratemaking Seminar March 10, 2005.
Issues in California Workers Compensation Michele Bernal, FCAS VP & Actuary, American Re 6/15/00.
March 9-10, 2000 The Contest - Part I CAS Seminar on Ratemaking SPE - 47 Thomas L. Ghezzi, FCAS, MAAA Katharine Barnes, FCAS, MAAA.
Slide 1 Basic Track III 2001 CLRS September 2001 New Orleans, Louisiana.
Workers Compensation Update Karen Ayres, FCAS, MAAA NCCI Casualty Loss Reserve Seminar September 12, 2005.
My Ceding Company's Data is Not Credible, So NOW What Do I Do? Directors and Officers Liability Linda Bjork, FCAS, MAAA American Re-Insurance Company.
1 Casualty Actuarial Society Loss Reserve Seminar Thomas G. Moylan, FCAS, MAAA September 8th, 2003 Closing the Books.
Ab Rate Monitoring Steven Petlick CAS Underwriting Cycle Seminar October 5, 2009.
 2005 NCCI Holdings, Inc. Workers Compensation State of the Line 2006 CAS Ratemaking Seminar Jeff Eddinger, FCAS, MAAA Practice Leader & Senior Actuary.
1 Casualty Loss Reserve Seminar September 2004 Solvency Surveillance- What is Working and What is Not Ron Dahlquist, FCAS, MAAA California Dept. of Insurance.
INTRODUCTION TO REINSURANCE EXPERIENCE & EXPOSURE RATING UNDERWRITING INFORMATION MICHAEL E. ANGELINA - TOWERS PERRIN ROBIN MURRAY – TOWERS PERRIN CAS.
Atlanta, Georgia September 11, 2006 Anita Sathe, ACAS, ASA – Deloitte Consulting LLP Christopher Bozman, FCAS, MAAA – Towers Perrin Tillinghast Michael.
 2002 NCCI Holdings, Inc. Workers Compensation: Emerging Issues WC Industry Reserve Adequacy Karen Ayres, FCAS, MAAA Casualty Loss.
Loss Reserving: Is It Broken? What Can Be Done Better? Casualty Loss Reserve Seminar September 14, 2004 Chuck Emma, Pinnacle Tom Ryan, Milliman John J.
1 Casualty Actuarial Society Loss Reserve Seminar ALLAN R. NEIS, FCAS, MAAA September 11, 2001 Closing the Books.
1 Casualty Loss Reserve Seminar Claudette Cantin, FCIA, FCAS, MAAA Munich Reinsurance Company of Canada September 14, 2004 Las Vegas Session 7 Loss Reserve.
JLT RE SOLUTIONS, INC. Introduction to Reinsurance Reserving Las Vegas, Nevada September 13, 2004 Bruce D. Fell, FCAS, MAAA, CFA Casualty Loss Reserve.
March 10, 2005 Gail E. Tverberg, FCAS, MAAA Pitfalls in Evaluating Proposed Tort Reforms CAS 2005 Ratemaking Seminar Session Call-2.
©Towers Perrin Introduction to Reinsurance Reserving Casualty Loss Reserve Seminar Atlanta, Georgia September 11, 2006 Christopher K. Bozman, FCAS, MAAA.
Basic Track II 2004 CLRS September 2004 Las Vegas, Nevada.
Introduction to Reinsurance Reserving Casualty Loss Reserve Seminar Chicago, Illinois September 9, 2003 Christopher K. Bozman, FCAS, MAAA.
2002 CAS Reinsurance Seminar Economic Forces Driving the Property/Casualty Industry May 2002.
September 13, 1999 Joanne M. Ottone, FCAS, MAAA Workers Compensation Reserve Issues in Selected States Nevada.
1 Casualty Actuarial Society Loss Reserve Seminar Chicago Marriott Chicago, Illinois ALLAN R. NEIS, FCAS, MAAA September 8-9, 2003 Closing the Books.
September 11, 2001 Thomas L. Ghezzi, FCAS, MAAA Casualty Loss Reserve Seminar Call Paper Program Loss Reserving without Loss Development Patterns - Beyond.
The Run-Off Environment – Considerations for the Reserving Actuary Jason Russ, FCAS Principal Milliman, Inc.
CAS Loss Reserve Seminar Loss Reserving Issues for Small Insurance Companies Patrick J. Crowe, FCAS, MAAA, ARM Vice President and Actuary Kentucky Farm.
2005 Casualty Loss Reserve Seminar Loss Reserve Analysis and Statements of Actuarial Opinion Robert E. Farnam Senior Financial Analyst and Actuary A.M.
“The Effect of Changing Exposure Levels on Calendar Year Loss Trends” by Chris Styrsky, FCAS, MAAA MAF Seminar March 22, 2005.
CLRS Intermediate Track III September 2001 New Orleans, Louisiana.
1998 CASUALTY LOSS RESERVE SEMINAR Intermediate Track II - Techniques
Reserving in Mergers and Acquisitions
Reinsurance Reserving Methods
September 2008 Washington, DC
2003 CLRS September 2003 Chicago, Illinois
1999 Casualty Loss Reserve Seminar
Introduction to Reinsurance Reserving
1999 CLRS September 1999 Scottsdale, Arizona
2001 CLRS September 2001 New Orleans, Louisiana
ASU Short Duration Contracts – New GAAP Disclosures
1998 Casualty Loss Reserve Seminar
Non-Life Loss Reserving Practices and Documentation
Presentation transcript:

September 11, 2001 Kathy Barnes, FCAS, MAAA Loss Development in Massachusetts Private Passenger Automobile Casualty Loss Reserving Seminar - New Orleans

2 Market Segments Reviewed for Massachusetts Private Passenger Automobile (PPA) Industrywide - Used in Commissioner's Rate Setting Process, and as Benchmarks for Individual Companies Residual Market (Commonwealth Automobile Reinsurers or CAR) - Used by Companies in Reserving for Business Assumed from CAR Individual Companies’ Direct and Retained (i.e., not ceded to CAR) Business

3 Massachusetts Industrywide Loss Development Data Available from Industry Filing Incurred Losses Plus Paid ALAE for Liability Paid Losses for Physical Damage Issues Affecting Loss Development Reforms Effective in 1989 Case Reserve Adequacy Changes in Market Share of Carriers

4 Massachusetts PPA - Industry Reform Effects in 1989 Financial Responsibility Limits Increased from 10/20 to 20/40 Over Three Years PIP Tort Threshold Increased from $500 to $2,000 Other Effects (Changes to SDIP Plan, Etc) Estimated Effect of Legislation: -13.7% on Liability, -4.6% on Physical Damage

5 Massachusetts PPA - Industry Case Incurred Losses - BI Basic Limits ($ in Millions)

6 Massachusetts PPA - Industry Case Incurred Losses - BI Basic Limits Accident Years 1990 through 1994 Significant Growth in Market Share of One Carrier with Higher Average Case Reserves Accident Years 1995 through 1999 Relatively Stable Market Share for Carriers Calendar Year 2000 Two Insolvencies - Combined Market Share Over 6% Data Reporting Issues for Prior Accident Years

7 Massachusetts PPA - Using Industry Data as Benchmarks Report-to-Report Factors - Use Industry Data With Judgmental Adjustments Reserve Adequacy Adjustments Not Possible (No Claim Count Data Available Other than Reported) No Paid Data Available for Liability, No Case Reserves Data Available for Physical Damage Bornhuetter-Ferguson Methods - Use Industry Pure Premium or Loss Ratio Data With Judgmental Adjustments

8 Massachusetts PPA - CAR Loss Development Total CAR Losses by Policy Year are Allocated to Company, and Booked as Assumed Losses Data Available from CAR Reports to Estimate CAR Losses Incurred Losses (Liability Only) Paid Losses Paid ALAE CAR Loss Reserving Committee IBNR Estimates  Lots of Judgment by Committee

9 Massachusetts PPA - CAR Liability Total Limits Total Market Figures Based on Data from Industry Filings. CAR figures from CAR Reports Evaluated as of March 2001 As CAR Market Share Decreases, Business in CAR Becomes More Residual, With Higher Pure Premiums

10 Massachusetts PPA - CAR Loss Development Historical Report-to-Report Factors Will be Affected by Same Issues as Industrywide Data Reform, Changes in Case Reserve Adequacy, Changes in Market Shares by Carrier Additional Distortion Due to CAR Market Share As CAR Population Shrinks, Ceded Business Tends to Have Lower Limits, So Reporting Tends to be Quicker In Bornhuetter-Ferguson Methods, Adjust Industrywide Estimates of Pure Premium or Loss Ratio to Reflect CAR Market Share Timing Issues for CAR Data Data Available at Year End Reflects only Nine Months Experience for the Current Policy Year

11 Massachusetts PPA - Loss Development Summary Historical Report-to-Report Factors For Both Industry and CAR are Distorted by a Number of Issues, and Need to be Adjusted Before Using as Benchmarks Both CAR and Retained Losses are Affected by the CAR Market Shares For the Industry, CAR Market Share Affects the Total CAR Results For Individual Carriers, CAR Market Share Affects the Retained Results Adjusted Industry Data Can Provide Useful Benchmarks for Report-to-Report Factors and Bornheutter-Ferguson Methods