Lines of Business
Name 4 different lines of business that AIG write policies for.
AL
GL
WC
D&O
E&O
Med Mal
Property
What are the three methods that actuaries live by?
Loss development, BF, ELR
What shape are most schedule P exhibits shown in?
Triangles
Who has given the best actuarial immersion presentation so far this year?
Jing and Will
How do we apply the chainladder (LDF) method?
Apply historical age-to-age factors to current data to project ultimate losses.
Is Workers Comp considered long or short tailed? And would LOB have high or low IBNR risk?
Long Tailed ; High IBNR risk
Name one assumption behind the LDF method.
2) claims observed from an immature period tell you something about claims yet to be observed
3) consistent claims handling practices
4) stable mix (limits, deductibles, policy types)
Name one component of the schedule P?
1) Incurred Losses
2) Paid Losses
3) IBNR
4) Claim Counts
How long has Jing worked at AIG?
How long has Will worked at AIG?
8 years
5 years
What two methods is the BF method a blend of?
Loss Development (Chain ladder)
ELR Method
Is Auto Physical Damage considered long or short tailed? And would LOB have high or low IBNR risk?
Short Tailed ; Low IBNR Risk
Explain how to calculate an age to age loss development factor.
Losses at period X+1 over losses at period X
Is schedule P a GAAP or STAT filing?
STAT
What office are Jing and Will located in?
Atlanta
What is the iceberg anaolgy?
Case Reserves are the part of the iceberg we can see (known claims)
IBNR is the part of the iceberg we cannot see (unknown claims)
Is Homeowners considered long or short tailed? And would LOB have high or low IBNR risk?
Short Tailed ; Low IBNR Risk
What does the last diagonal of loss development triangle represent?
The cumulative losses as of the latest evaluation date in the triangle.
Explain the difference between GAAP and STAT financial statments?
GAAP statements are regulated by the SEC for public companies.
STAT statements are provided to the state insurance commissioners. (regulators)
What is Jing's job title?
AIGRM Pricing Actuary
Name two parties that the reserving actuaries communicate with pre-reserve analysis?
Claims Department
Underwriting
Pricing Actuaries
Data Office
Is Med Mal considered long or short tailed? And would LOB have high or low IBNR risk?
Very Long Tailed ; High IBNR Risk
When determining reserving segments, what two things do we balance?
Credibility and Homogeneity
Who is the appointed actuary at AIG?
Steve Turner
What were the three lines of business that Will has worked on?
Environmental Liability, Workers Comp, Primary AL and GL
Explain how to set up a loss development triangle, what is on the rows, what is on the columns?
Accident (Policy, Calendar) Year for each row.
Development age for each column.
Loss amounts for each combination of year of development period.