elements of IBNR reserve

[Sox34]

(question in A12 in CSM - Spring 99 3B #67)

How do you know when the IBNR reserve should = elements 4+5 (pure IBNR and claims in transit) or 2 - 5 (pure IBNR, claims in transit, provision for dev on known claims, and reopened claims reserve)? All 10 says that the latter is more commonly used in practice, but this old exam question uses the former as = to the total IBNR reserve.

How do we know on the exam which definition of IBNR reserve to use?

thanks!

[Examinator]

I had these questions as well, early on, but now I'm wondering if this stuff isn't important.

[JAS]

If it's an essay question, just write down what you've assumed is IBNR.

[Sox34]

If it's an essay question, just write down what you've assumed is IBNR.

yeah that's what I'm thinking - I'm trying to go thru all of the CSM past exam problems that I didn't do in All 10 and I'm thinking that the key thing is to state what you assume and hopefully you'll be ok.

thanks.

[tommie frazier]

I always took case reserve to be specifically the posted amount by the claims dept.

the other 4 parts combine for IBNR.

my opinion.

[Mary Frances]

It should be pretty clear from the context which you are trying to estimate. Calculating pure IBNR by itself (as opposed to IBNR + IBNER) is pretty rare unless you are doing a frequency/severity based analysis.