A Probabilistic Model for IBNR Claims [Discussion]

Mr. Guiahi’s paper presents a model that is a good starting point for estimating the reserve associated with claims that have been incurred but are not reported. Since he refers only to "claim costs," it is not clear whether this reserve is for losses only, or losses and allocated loss adjustment expense. His technique can be applied to either or to allocated loss adjustment expenses only, provided that the model parameters are selected appropriately.