Although there are variations, most insurers can be said to count claims =
on either an "accident" or "claimant" basis. (These are my labels, and =
are not "official" in any way.) Suppose that your insured is at fault =
in an accident that injures two people. Both injured people bring =
actions against your insured. If you set up one BI liability reserve =
for the accident, then you count claims on a "accident" basis. If you =
set up two reserves, then you do things on a "claimant" basis.
There are a lot of technical data management nuances to this area, =
because insurers that keep track of claimants need to pull this =
information back together for various purposes. Well done, a claimant =
reporting basis provides more flexibility to users, because it can tell =
you everything that an "accident" basis can, plus more. But that is not =
the question, nor do I want to know which way that you count claims. (A =
survey that we took indicated that almost all ISO-reporting insurers =
count on a "claimant" basis, while non-ISO insurers split about 50-50 =
between the two methods.)
The question that I have is this: Is anyone aware of any studies, formal =
or informal, published or unpublished, that provide any quantification =
of the average claim frequency differences that occur purely because of =
these two different ways of counting claims? The answer would appear to =
be different for BI and PD.
Thank you.
Alan Wickman
awickman@doi.state.ne.us
Nebraska Department of Insurance
941 "O" Street, Suite 400
Lincoln, NE 68512
The NAIC group is the "Statistical Handbook Working Group."
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