Estimation and Application of Ranges of Reasonable Estimates

This paper discusses the concept of a "range of reasonable estimates" as used in the casualty actuarial reserving context. The relationship between the range and financial condition is addressed and several methods for estimating the range are identified, with one method, the "Method of Convolutions" discussed at length. The problems associated with the aggregation of individual accident year and line of business ranges into an aggregate range are discussed and a methods for aggregation is presented. Finally, some observations on the application of the range are offered.