Bornhuetter-Ferguson reported claim count method

Bornhuetter-Ferguson reported claim count method. This method projects ultimate claim counts in two parts, expected open claims that will close with indemnity payment plus actual reported claims through year-end. Open claims that will close with payment are estimated to be the expected percentage open times initial expected ultimate claim counts. The expected percentage open is based on the selected reported claim count development factors to ultimate. Initial expected ultimate claim count is the same as for the closed claim count Bornhuetter-Ferguson method. This method is best when claim count reporting patterns tend to be unstable.

admin posted at 2009-3-29 Category: Insurance