Risk Margins for Discounted Loss Reserves

Jim Shoenfelt ( (no email) )
Tue, 18 Aug 1998 22:52:36 -0400

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This paper says that an argument against booking a risk margin as a =
liability item is that it fails to fully recognize the time value of =
money. Can someone explain this to me? I don't see how adding a risk =
margin fails to reconize the time value of money - especially since a =
risk margin would generally be accompanied with discounted reserves. P. =
150-151

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 This =paper says that=20an argument against booking a risk margin as a liability item is that it =fails=20to fully recognize the time value of money.  Can someone explain =this to=20me?   I don't see how adding a risk margin fails to reconize =the time=20value of money - especially since a risk margin would generally be =accompanied=20with discounted reserves.  P. =150-151
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