Claims Development by Layer - Sahasrabuddhe

Study Strategy

Checklist

1. Be able to explain why we need to adjust loss development factors in different layers
2. Be able to calculate the trend index
3. Be able to calculate LEVs given values of \(\theta\) and the LEV formula for a distribution
4. Be able to calculate adjusted loss development factors for a given layer
   • Adjust the cumulative losses to the basic limit and appropriate cost level
   • Calculate the LDFs based on the adjusted cumulative losses
   • Use the LEVs to adjust the LDFs for the given layer
5. Be able to explain the impact the value of theta has on the adjusted LDFs
6. Be able to describe the purpose of a claims layer ratio
7. Know the properties of the claims layer ratio
8. Be able to calculate adjusted LDFs using the claims layer ratio and the LEVs at ultimate

My Notes