Allocated Loss Adjustment Expense Reserves

In recent year, allocated loss adjustment expense (ALAE) reserves have grown significantly relative to loss reserves for many lines of business. This panel will discuss methods for controlling allocated loss adjustment expenses, as well as, methods that can be used to estimate appropriate ALAE reserves. The panel will discuss the impact of the following items on ALAE – defense within limits, deductibles, shifts in attorney reimbursement procedures, increased use of in-house attorneys, use of alternate dispute resolutions, and other issues related to litigation management. The panel will also discuss methods that can be used to detect changes in ALAE levels.