Reserve Review of a Reinsurance Company

The estimation of reserves for a reinsurance company is conceptually similar to the estimation of reserves for a primary insurance company. However, due to a number of differences between primary and reinsurance companies, the actual practice of reserving for reinsurance companies involves a process which is quite distinct from methods commonly used for primary companies. In this discussion paper we hope to accomplish two goals: discuss a reserving approach which is appropriate for reinsurance companies, and provide a methodology for analyzing development patterns which is especially applicable to reinsurance companies, but also has applications for primary companies. In this paper we will assume the reader is generally familiar with reserving practices for primary companies. We will focus on those situations which are unique or different for reinsurance companies. Reinsurance Research - Reserving