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P and C insurers invest the majority of their assets in long-term securities. Key to feature of claims loss risk is the actuarial predictability of losses. Social inflation has been particularly prevalent in commercial liability and medical malpractice insurance.
P and C insurers invest the majority of their assets in long-term securities. Key to feature of claims loss risk is the actuarial predictability of losses. Social inflation has been particularly prevalent in commercial liability and medical malpractice insurance.
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P and C insurers invest the majority of their assets in long-term securities. Key to feature of claims loss risk is the actuarial predictability of losses. Social inflation has been particularly prevalent in commercial liability and medical malpractice insurance.
Copyright:
Attribution Non-Commercial (BY-NC)
Verfügbare Formate
Als PPTX, PDF, TXT herunterladen oder online auf Scribd lesen
the proportion held in common stock is lower than that of life insurance companies. m á set-aside reserve that contains the portion of a premium that has been paid at the start of the coverage period P & C underwriting risk results when the premiums generated on a given insurance line are: 1. the claims and (losses) incurred insuring the risk 2. the administrative expenses of providing that insurance coverage after taking the account 3. the investment income generated between the time when the premiums are received to the time when losses are covered. ëhus, underwriting risk may result from:
1. unexpected increase in loss rates
2. unexpected increase in expenses 3. unexpected decreases in investment yields or returns ëhe key to feature of claims loss risk is the actuarial predictability of losses relative to premiums earned. m Property versus Liability:
ëhe maximum levels of losses are more
predictable for property lines than for liability lines.
m Severity versus Frequency:
Loss rates are more predictable on low-
severity, high-frequency lines than on high-severity, low frequency lines. m Long tail versus Short tail:
Long tail loss -> arises in policies for which the
insured event occurs during a coverage period but a claim is not filed or made until many years later.
m Product inflation versus Social inflation
Loss rates on all P & C property policies are
adversely affected by unexpected increases in inflation.
ëhe inflation risk of property lines is likely to
reflect the approximate underlying inflation risk of the economy. Social inflation has been particularly prevalent in commercial liability and medical malpractice insurance and has been directly attributed by some analysts to faults in the U.S civil litigation system.
Loss ratio -> measures the actual losses
incurred on a specific policy line. It measures the ratio of losses incurred to premiums earned.
Premiums earned -> premiums received
and earned on insurance contracts because time has passed without a claimed being filed. m ð ð -> is based on the pooling of risks
m á reinsurer diversifies risk of the
individual policies by writing many unrelated policies for different insurance companies, so that the potential overall loss from the pool of reinsurance policies is small relative to the reinsurer·s capital.