Better consideration of insurance cycles and economic trends and transparent reporting will help insurers improve their reserving practices, according to Swiss Re's latest sigma study.
The study, "Non-life claims reserving: improving on a strategic challenge," examined various reserving techniques used by insurers, reported factors that contribute to reserving errors, and suggested ways the industry can more effectively set reserves.
In explaining the factors that can cause reserve revisions, the study noted, "Reserving decisions are based on forecasts of final claims payments. Any significant mismatch between assumptions and reality leads to reserve revisions."
Want to continue reading?
Become a Free PropertyCasualty360 Digital Reader
Your access to unlimited PropertyCasualty360 content isn’t changing.
Once you are an ALM digital member, you’ll receive:
- All PropertyCasualty360.com news coverage, best practices, and in-depth analysis.
- Educational webcasts, resources from industry leaders, and informative newsletters.
- Other award-winning websites including BenefitsPRO.com and ThinkAdvisor.com.
Already have an account? Sign In
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.