Liability and Workmen's Compensation Loss Reserves

The laws of the various states, relating to liability and workmen's compensation insurance, are crude in the extreme when viewed from a logical and scientific viewpoint. Even more crude are the plans advanced by some of our able actuaries. What we lack more than anything else is a standard, legalized, accident table by which we can measure the expected cost and determine the proper reserves regardless of the premiums collected. It is almost an axiom that inadequate premiums will, under our present laws, produce inadequate reserves, this, of course, being due to the fact that the reserves are computed as a percentage of the premium.