In a new report, Fitch Ratings discusses property/casualty insurer loss reserves for older underwriting periods, and challenges in assessing reserve strength for insurers with longer tail claims liabilities.

Reserves from accident years before 1999 represent approximately 14% of industry loss reserves. These liabilities have consistently increased over time and are largely in workers compensation and several liability product segments. In the report, Fitch assesses changes in composition, claims development trends, and loss payment history of prior period reserves using statutory data from 1999-2008.

The report also considers the difficulty in estimating ultimate loss development factors in projecting insurer's reserve adequacy due to data constraints. Fitch's longer term compilation of company and industry aggregate implied tail factors by business segment provides greater perspective in assessing reserve strength in longer tail liabilities.

To access this Special Report, 'Analysis of Prior Period Loss Reserves and Tail Factors' please visit www.fitchratings.com under Insurance > Special Reports.


Fitch's rating definitions and the terms of use of such ratings are available on the agency's public site, www.fitchratings.com. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures are also available from the 'Code of Conduct' section of this site.

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This article was prepared by Insurance Weekly News editors from staff and other reports. Copyright 2009, Insurance Weekly News via VerticalNews.com.