Economic Factors in Liability and Property Insurance Claims Costs, 1935-1967 [Discussion]

The standard ratemaking techniques for most lines of insurance incorporate some recognition of the increasing cost of settling claims. It is generally recognized that the current cost level has changed and that the future cost level will be different from that at the time of occurrence of the claims included in the detailed statistical data underlying the calculation of the rates. For most lines the adjustment to compensate for such change is based upon an analysis of insurance data.