LRLossReserves.com
Evergreen explainers

Learn.

Durable references on reserving methodology, segment-specific IBNR, and how to read a reserve report. Written to be a CFO's first stop, and an actuary's recommendation when a client asks "what should I read?"

43
Long-form explainers, revised when standards change.
5
Reserving methods explained side by side, in plain English.
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Claims Analytics

Claims Analytics and Loss Reduction: How Operational Data Lowers Future IBNR

What claims analytics actually is, how it differs from actuarial reserving, and the operational interventions that measurably reduce future losses for self-insured employers, captives, and risk pools.

13 min read
Self-Insured

IBNR for Public Entity Pools and JPAs: A Plain-English Guide for Pool Administrators and Member Finance Officers

What IBNR means for a public entity risk pool or joint powers authority, how actuaries handle member allocation and sovereign immunity, and what to require in the annual reserve study.

13 min read
Fundamentals

Loss Reserves Explained: What They Are, How They Are Calculated, and Why They Matter

A loss reserve is the dollar estimate of what an insurer, captive, or self-insured entity still owes on claims that have already happened. Here is what sits inside that number, how actuaries arrive at it, and why it moves after you book it.

12 min read
Captives

Reading Your Captive's Annual Reserve Report: A Board Member's Guide

What a captive board member should read in the annual reserve report and Statement of Actuarial Opinion, the questions to ask the actuary, and the gross-ceded-net bridge every captive board must understand.

13 min read
Captives

Captive Feasibility Studies: What the Actuary Contributes Before the Captive Exists

What the actuary contributes to a captive feasibility study: the pro forma loss pick, exposure base selection, retention analysis, confidence level capital sizing, and what the buyer should require from the report.

13 min read
Captives

Captive Funding at a Confidence Level: How the Percentile Selection Drives the Capital Number

How actuaries fit aggregate loss distributions and select confidence levels for captive funding, why the variance assumption can drive the answer more than the chosen percentile, and what to require from the actuary's report on the funded amount.

13 min read
Captives

Discounting Captive Reserves: Statutory, Tax, GAAP, and IFRS Compared

Why a captive's statutory, tax, GAAP, and IFRS reserve values differ for the same liabilities, how the discount is constructed in each framework, and what the board should require for reconciliation.

13 min read
Captives

Cell Captives and Protected Cell Companies: How the Structure Changes the Reserving Problem

What a cell captive and a protected cell company actually are, how statutory ring-fencing affects reserving and capital sizing, and what to require from the actuary's report on a cell's reserve.

13 min read
Captives

Loss Portfolio Transfers, Adverse Development Covers, and Captive Runoff: How Captives Close Out Retained Risk

How loss portfolio transfers, adverse development covers, and runoff work for captive insurers, the actuarial inputs that drive pricing, and what to require from the actuary during the transaction.

14 min read
Captives

Tail Factor Selection for Captives: Where Actuarial Judgment Matters Most

How actuaries select tail factors for captive reserves, why it is the most subjective input in the chain ladder, and what to require from your actuary on the tail.

13 min read
Regulation

When Self-Insured Reserves Hit the Financial Statements: ASC 450, ASC 944, and What the Auditor Is Actually Evaluating

The GAAP accrual rules for self-insured losses, how a range with a best estimate gets treated differently from a range without one, and what the external auditor is trying to conclude when they review your reserve number.

11 min read
Regulation

Audit Committee Reserve Governance: The Five Questions Every Committee Should Ask

What the audit committee needs to see on reserves, the five questions that should be asked every year, and how a CFO or risk manager prepares the packet that turns a technical topic into a governance conversation.

9 min read
Regulation

What Captive Domicile Regulators Look At: A Finance Officer's Survey of Vermont, Cayman, Bermuda, South Dakota, and Utah

What each major domicile actually examines in the annual filing, the reserve review requirements, solvency triggers, and what 'regulated but light' means in practice. For anyone choosing a domicile or considering a re-domicile.

12 min read
Regulation

Collateral and Surety for Self-Insured Workers Compensation: How Reserves Drive the Bond You Have to Post

How state workers comp bureaus set collateral requirements, why the number often exceeds the actuarial reserve, and how to negotiate with the bureau when the requirement feels disconnected from your actual exposure.

10 min read
Fundamentals

How to Interview a Reserve Actuary: Twelve Questions That Separate Pros From Approximators

The interview is where you separate the signing actuary who will do the work from the firm that just bid well. Here are the questions to ask, what good answers sound like, and what weak answers sound like.

12 min read
Regulation

The §832 Deduction: What Makes Your Captive's Reserves Tax-Deductible

The risk shifting and risk distribution tests, what the IRS actually evaluates, how reserve methodology ties to deductibility, and what recent micro-captive rulings mean for conventional captive owners.

10 min read
Fundamentals

How to Read an Actuarial Proposal: Green Flags, Red Flags, and What to Push Back On

The ten things a good proposal contains, the seven red flags that should stop you from engaging, and how to compare two bids that come back with different structures.

10 min read
Fundamentals

What a Reserve Review Should Cost: A Buyer's Guide to Actuarial Fees

Fee ranges by program type, the scope levers that move price up and down, and the red flags in a quote that looks too cheap or too expensive.

10 min read
Fundamentals

How to Write an RFP for a Reserve Review: A Buyer's Template

The sections an RFP actually needs, the data package to send with it, and what to leave out so the proposals you receive are comparable and the engagement runs clean.

11 min read
Fundamentals

When to Get a Second Opinion on Your Reserves: Five Triggers and How to Run One Cleanly

The triggers that make a second opinion worth the fee, how to scope it so it delivers real information, and how to run one without destroying your primary actuary relationship.

9 min read
Methods

Berquist-Sherman in Plain English

When your claims operation changes mid-stream, the historical triangle lies. Berquist-Sherman is the standard correction, and you should know what it does, what it assumes, and when to demand it.

14 min read
Methods

Bornhuetter-Ferguson: The Method That Balances Past Data and Prior Expectation

BF blends the chain ladder's development pattern with an expected claim ratio, weighted by maturity. Here is how it works, what it assumes, and why it is the natural default for your most recent accident years.

13 min read
Fundamentals

Case Reserve Strengthening: What It Looks Like in Your Triangle and What It Does to Your Reserves

When adjusters start setting higher case reserves, your reported triangle inflates, your development factors shift, and the chain ladder overstates the ultimate. Here is how to spot it, what it costs, and what to require from your actuary.

13 min read
Methods

Chain Ladder: How Actuaries Project Claims From Historical Patterns

The chain ladder is the most widely used reserving method, and the one most likely to produce the number on your balance sheet. Here is how it works, what it assumes, and where it fails.

13 min read
Self-Insured

Commercial Auto and Fleet IBNR for Self-Insured Trucking, Delivery, and Transit

How actuaries estimate unpaid auto liability claims for self-insured fleets, why bodily injury severity dominates the reserve, and what to require in the report.

13 min read
Fundamentals

How to Evaluate an Actuary's Report: A Self-Insured's Scorecard

A section-by-section scoring framework for judging whether the methods, diagnostics, assumptions, and range in your reserve report are sound, not just present.

14 min read
Methods

How Actuaries Estimate Your Unpaid Claims: A Buyer's Guide to the Five Core Methods

Every reserve estimate starts from one equation and five methods. Here is what each method assumes, when it works, when it breaks, and which one your actuary probably leaned on for the number you are signing off on.

12 min read
Self-Insured

Hospital and Health System Professional Liability IBNR

How actuaries estimate unpaid medical professional liability claims for hospitals and health systems, why the captive structure creates a net-exceeds-gross wrinkle, and what to require in the report.

13 min read
Fundamentals

Interim Monitoring vs. Annual Full Review: What You Should Expect Between Opinions

How quarterly monitoring catches reserve drift before it compounds, what it includes that a full annual review does not, and what to require from your actuary between opinions.

13 min read
Self-Insured

Public Entity General Liability IBNR: Municipalities, Schools, and Special Districts

How actuaries estimate unpaid general liability claims for public entities, why latent exposures and revival windows make the tail longer than it looks, and what to require in the report.

13 min read
Fundamentals

Pure IBNR vs. Broad IBNR: Why the Distinction Matters More for Self-Insureds

The IBNR line on your actuarial report bundles two very different uncertainties into one number; understanding which piece is driving the estimate changes what you should ask and how you should fund.

11 min read
Fundamentals

What Could Be Wrong With Your Reserves: A Self-Insured's Guide to Diagnostic Review

A framework for identifying whether your reserve estimate was distorted by operational changes, and the specific questions that turn a black-box number into something you can evaluate.

11 min read
Captives

Self-Insurance, Captives, Large Deductibles, and SIRs: What the Differences Mean for Your Reserves

Four risk-financing structures look similar from the outside but create different reserve obligations, different regulatory expectations, and different actuarial workflows; here is how to tell them apart and what each one means for the number on your balance sheet.

14 min read
Self-Insured

Workers Compensation IBNR for Self-Insured Employers

How actuaries estimate unpaid workers compensation claims for self-insured programs, what drives the number, and what to require in the report.

13 min read
Claims Analytics

Five Leading Indicators of Adverse Reserve Development: What Your TPA Already Tracks That Your Actuary May Not See

The five claim-level metrics that predict adverse reserve development 6 to 18 months before it shows up in your actuarial report, and how to ask your TPA for them.

12 min read
Methods

Fronting, Reinsurance, and Why Your Captive's Net IBNR Can Exceed Gross

How gross, ceded, and net reserves should bridge in a fronted captive, why net IBNR can sometimes exceed gross, and the six questions to ask about your actuary's gross-to-net bridge.

14 min read
Captives

IBNR for Group Captives and RRGs: A Plain-English Guide for Captive Managers and Member Boards

What IBNR means for a group captive or risk retention group, how actuaries handle pooling and per-occurrence retentions, and what to expect from a reserve study.

13 min read
Self-Insured

IBNR for Self-Funded Health Plans: A Plain-English Guide for Benefits CFOs and HR Directors

What IBNR means for a self-funded employer health plan, how actuaries estimate it, and what to expect from a reserve study.

12 min read
Captives

IBNR for Single-Parent Captives: A Plain-English Guide for Captive Owners and Risk Managers

What IBNR means for a single-parent captive insurer, how actuaries estimate it, and what to expect from the annual reserve study and Statement of Actuarial Opinion.

13 min read
Claims Analytics

What's Actually Driving Your IBNR Higher? A Claim-Level Diagnostic Guide for Risk Managers and CFOs

How to diagnose whether your adverse reserve development is coming from case reserves, payment patterns, or claim mix, and what to do about each one.

13 min read
Fundamentals

IBNR, Explained Without the Jargon

What incurred-but-not-reported really means, why it is almost always the largest piece of a self-insured entity's reserves, and how to read an IBNR estimate without being an actuary.

8 min read
Fundamentals

How to Read a Loss Development Triangle

A loss triangle looks like a spreadsheet with a staircase cut out of it. Here is what the rows, columns, and diagonals are telling you, and what to look for before you trust the projection on the bottom line.

18 min read
Fundamentals

Point Estimate vs Range: Which One Should a Self-Insured Book?

A single-number reserve looks decisive. A range looks honest. The right choice depends on what you are using the estimate for, and the answer is rarely the middle of the range.

7 min read

Basics

Engaging an Actuary

Diagnostics

Captives

Reading Your Captive's Annual Reserve Report: A Board Member's Guide

What a captive board member should read in the annual reserve report and Statement of Actuarial Opinion, the questions to ask the actuary, and the gross-ceded-net bridge every captive board must understand.

13 min read
Captives

Captive Feasibility Studies: What the Actuary Contributes Before the Captive Exists

What the actuary contributes to a captive feasibility study: the pro forma loss pick, exposure base selection, retention analysis, confidence level capital sizing, and what the buyer should require from the report.

13 min read
Captives

Captive Funding at a Confidence Level: How the Percentile Selection Drives the Capital Number

How actuaries fit aggregate loss distributions and select confidence levels for captive funding, why the variance assumption can drive the answer more than the chosen percentile, and what to require from the actuary's report on the funded amount.

13 min read
Captives

Discounting Captive Reserves: Statutory, Tax, GAAP, and IFRS Compared

Why a captive's statutory, tax, GAAP, and IFRS reserve values differ for the same liabilities, how the discount is constructed in each framework, and what the board should require for reconciliation.

13 min read
Captives

Cell Captives and Protected Cell Companies: How the Structure Changes the Reserving Problem

What a cell captive and a protected cell company actually are, how statutory ring-fencing affects reserving and capital sizing, and what to require from the actuary's report on a cell's reserve.

13 min read
Captives

Loss Portfolio Transfers, Adverse Development Covers, and Captive Runoff: How Captives Close Out Retained Risk

How loss portfolio transfers, adverse development covers, and runoff work for captive insurers, the actuarial inputs that drive pricing, and what to require from the actuary during the transaction.

14 min read
Captives

Tail Factor Selection for Captives: Where Actuarial Judgment Matters Most

How actuaries select tail factors for captive reserves, why it is the most subjective input in the chain ladder, and what to require from your actuary on the tail.

13 min read
Captives

Self-Insurance, Captives, Large Deductibles, and SIRs: What the Differences Mean for Your Reserves

Four risk-financing structures look similar from the outside but create different reserve obligations, different regulatory expectations, and different actuarial workflows; here is how to tell them apart and what each one means for the number on your balance sheet.

14 min read
Captives

IBNR for Group Captives and RRGs: A Plain-English Guide for Captive Managers and Member Boards

What IBNR means for a group captive or risk retention group, how actuaries handle pooling and per-occurrence retentions, and what to expect from a reserve study.

13 min read
Captives

IBNR for Single-Parent Captives: A Plain-English Guide for Captive Owners and Risk Managers

What IBNR means for a single-parent captive insurer, how actuaries estimate it, and what to expect from the annual reserve study and Statement of Actuarial Opinion.

13 min read
Self-Insured

IBNR for Public Entity Pools and JPAs: A Plain-English Guide for Pool Administrators and Member Finance Officers

What IBNR means for a public entity risk pool or joint powers authority, how actuaries handle member allocation and sovereign immunity, and what to require in the annual reserve study.

13 min read
Self-Insured

Commercial Auto and Fleet IBNR for Self-Insured Trucking, Delivery, and Transit

How actuaries estimate unpaid auto liability claims for self-insured fleets, why bodily injury severity dominates the reserve, and what to require in the report.

13 min read
Self-Insured

Hospital and Health System Professional Liability IBNR

How actuaries estimate unpaid medical professional liability claims for hospitals and health systems, why the captive structure creates a net-exceeds-gross wrinkle, and what to require in the report.

13 min read
Self-Insured

Public Entity General Liability IBNR: Municipalities, Schools, and Special Districts

How actuaries estimate unpaid general liability claims for public entities, why latent exposures and revival windows make the tail longer than it looks, and what to require in the report.

13 min read
Self-Insured

Workers Compensation IBNR for Self-Insured Employers

How actuaries estimate unpaid workers compensation claims for self-insured programs, what drives the number, and what to require in the report.

13 min read
Self-Insured

IBNR for Self-Funded Health Plans: A Plain-English Guide for Benefits CFOs and HR Directors

What IBNR means for a self-funded employer health plan, how actuaries estimate it, and what to expect from a reserve study.

12 min read
Regulation

When Self-Insured Reserves Hit the Financial Statements: ASC 450, ASC 944, and What the Auditor Is Actually Evaluating

The GAAP accrual rules for self-insured losses, how a range with a best estimate gets treated differently from a range without one, and what the external auditor is trying to conclude when they review your reserve number.

11 min read
Regulation

Audit Committee Reserve Governance: The Five Questions Every Committee Should Ask

What the audit committee needs to see on reserves, the five questions that should be asked every year, and how a CFO or risk manager prepares the packet that turns a technical topic into a governance conversation.

9 min read
Regulation

What Captive Domicile Regulators Look At: A Finance Officer's Survey of Vermont, Cayman, Bermuda, South Dakota, and Utah

What each major domicile actually examines in the annual filing, the reserve review requirements, solvency triggers, and what 'regulated but light' means in practice. For anyone choosing a domicile or considering a re-domicile.

12 min read
Regulation

Collateral and Surety for Self-Insured Workers Compensation: How Reserves Drive the Bond You Have to Post

How state workers comp bureaus set collateral requirements, why the number often exceeds the actuarial reserve, and how to negotiate with the bureau when the requirement feels disconnected from your actual exposure.

10 min read
Regulation

The §832 Deduction: What Makes Your Captive's Reserves Tax-Deductible

The risk shifting and risk distribution tests, what the IRS actually evaluates, how reserve methodology ties to deductibility, and what recent micro-captive rulings mean for conventional captive owners.

10 min read
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