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AIAF 114 2.0 With 100% ACCURATE QUESTIONS AND ANSWERS ALREADY GRADED A+
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AIAF 114 2.0 With 100% ACCURATE QUESTIONS AND ANSWERS ALREADY GRADED A+
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JACKLINEAIAF 114 2.0 With 100% ACCURATE QUESTIONS AND ANSWERS ALREADY GRADED A+
Terms in this set (120)
An estimate of the amount of money the insurer expects to pay in the future for losses that have
Loss reserve
already occurred and been reported, but are not yet settled.
The expense that an insurer incurs to investigate, defend, and settle claims according to the terms
Loss adjustment expense (LAE)
specified in the insurance policy.
The expense an insurer incurs to investigate, defend, and settle claims that are associated with a
Allocated loss adjustment expense (ALAE)
specific claim.
Unallocated loss adjustment expense (ULAE) Loss adjustment expense that cannot be readily associated with a specific claim.
Estimates of the future expense that an insurer expects to incur to investigate, defend, and settle
Loss adjustment expense reserves
claims for losses that have already occurred.
Paid losses Losses that have been paid to, or on behalf of, insureds during a given period.
The losses that have occurred during a specific period, no matter when claims resulting from the
Incurred losses
losses are paid.
AIAF 114 2.0
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A method of organizing ratemaking statistics that uses incurred losses for an accident year, which
Accident-year method consist of all losses related to claims arising from accidents that occur during the year, and that
estimates earned premiums by formulas from accounting records.
Ultimate loss The final paid amount for all losses in an accident year.
Loss development The increase or decrease of incurred losses over time.
Case reserve A loss reserve assigned to an individual claim.
Bulk reserves Reserves established for the settlement of an entire group of claims.
Judgment method A method to establish a case loss reserve based largely on experience with similar claims.
A method to establish a case reserve by using an average amount for specific categories of
Average method
claims.
A case reserving method that establishes an average amount for all claims that have similar
Tabular method
characteristics in terms of the claimant's age, health, and marital status.
A factor that is applied to the most recent estimate of incurred losses for a specific accident year
Ultimate loss development factor
to estimate the ultimate incurred loss for that year.
The transfer of insurance risk from one insurer to another through a contractual agreement under
which one insurer (the reinsurer) agrees, in return for a reinsurance premium, to indemnify another
Reinsurance
insurer (the primary insurer) for some or all of the financial consequences of certain loss
exposures covered by the primary's insurance policies.
In reinsurance, the insurer that transfers or cedes all or part of the insurance risk it has assumed to
Primary insurer
another insurer in a contractual arrangement.
The insurer that assumes some or all of the potential costs of insured loss exposures of the
Reinsurer
primary insurer in a reinsurance contractual agreement.
Contract between the primary insurer and reinsurer that stipulates the form of reinsurance and
Reinsurance agreement
the type of accounts to be reinsured.
Insurance risk Uncertainty about the adequacy of insurance premiums to pay losses.
Retention AIAF 114 2.0 The amount retained by the primary insurer in the reinsurance transaction.
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