An Integrated Pricing and Reserving Process for Reinsurers

In today's market of increased competition, more complex reinsurance contracts and tightening (or should we say frightening) profit margins, actuaries are increasingly being called upon to improve their pricing and reserving practices concerning individual accounts as well as aggregate books of business. Increased understanding of that business is critical to continued success for both reinsurers and their clients. The purpose of this paper is to describe a framework for an integrated pricing and reserving process on an individual risk basis. Utilizing this framework, increasing levels of sophistication and knowledge can be brought to bear, risk by risk, on understanding a reinsurer's book of business.