A quantum leap in benchmarking P&C reserve ranges

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By Mark R. Shapland | 05 October 2018
Traditional development pattern benchmarks have provided some support in estimating fundamental liabilities, but even here, the process has long been a one-dimensional exercise, at least until now. A recently developed benchmarking tool, which includes percentiles at all stages of development, allows for the calibration of a benchmark that better resembles your portfolio. As such, this rigorously back-tested tool can provide actuaries an added level of confidence in the reasonableness of an entity’s reserve ranges. The next generation benchmarking tool, known as claim variability guidelines, is derived from extensive testing that involved all long-tail Schedule P lines of business and more than 30,000 data triangle sets.