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My Captive’s Actuarial Reserve Estimate Changed,

What Should I Review?

One of the most efficient ways of reviewing the impact of a captive’s losses is through an actuarial exhibit referred to as a “reconciliation of required reserves”.

Table 1: Reconciliation of Estimated Required Reserves

 

1. Prior estimated required reserves $1,000,000
2. Plus change in ultimate losses for historical periods $300,000
3. Plus ultimate losses for current period $150,000
4. Minus losses paid since prior evaluation $150,000
5. Current estimated required reserves $1,300,000

Table 2: Expanded Reconciliation of Estimated Required Reserves

 

1. Prior estimated required reserves $1,000,000
2A. Plus change in ultimate losses for periods prior to 2010 $250,000
2B. Plus change in ultimate losses for periods 2010 and forward $50,000
3. Plus ultimate losses for current period $150,000
4. Minus losses paid since prior evaluation $150,000
5. Current estimated required reserves $1,300,000

 

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Enoch Starnes, ACI

Actuarial Consultant

Michelle_cropped

Michelle Bradley, ACAS, MAAA, ARM, CERA

Consulting Actuary

 

We deliver analytical-based, data-driven decision support completed on time and on budget.

If you have a potential project where actuarial support may be helpful, schedule a complimentary brainstorming session with our actuarial staff.

Benefit from their 25+ years of industry experience.