Description: Runoff LTC blocks present a wide range of business risks. Outsourcing certain tasks to third parties can help mitigate these risks.

Description: For establishing the ongoing adequacy of claim reserves for blocks of long-term care insurance, retro testing is a blunt tool, the results of which are not conclusive. Claim reserve retro tests should be reviewed by claim duration, include the impact of interest consistently, and include updated assumptions that can have an impact on claim termination rates or other factors. The new NAIC LTC Experience Reporting Forms estimated to arrive for reporting year 2008 will help modernize LTCI retro tests, providing additional accuracy and standardization. Actuaries should not wait for these forms, but rather ensure that any claim reserve analysis moves beyond a basic calendar year retro test.

Description: Following up on recent articles on claim reserves and retrospective testing, this article examines some data quality and methodology issues related to calculating LTCI claim reserves.