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The Insurance Times

Q3. Write short notes on

a) Total Loss Reserve - Total loss reserve consists
of five elements :
(i) Case reserves assigned to specific claims
(ii) A provision for future development on known claims.
(iii) A provision for claims that reopen after they have
been closed.
(iv) A provision for claims that have occurred but have
not yet been reported to the insurer, and
(v) A provision for claims that have been reported to
the insurer but have not yet been recorded.

b) Known claims - The reserve for known claims
represent the amount that will be required for future
payments of claims that have already been reported to
the insurer.

This amount includes the case reserves, the sum total
of the individual estimates made by the adjusters. Some
of them can be set by formula.

c) Unknown claims - The reserve for unknown claims is

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