The video discusses IBNR (Incurred But Not Reported) reserves in the context of Long-Term Care. Nick Presel, a Senior Actuarial Associate, explains that IBNR reserves are held for policyholders eligible for benefits that the insurance company is not yet aware. He discusses the reasons for IBNR, such as elimination periods, the claim approval process, and delays due to policyholder circumstances. The video also covers the methodology for calculating IBNR reserves, which involves estimating the number of unreported claims and their average cost. Finally, it highlights the importance of ongoing analysis and collaboration with claim teams to ensure appropriate reserve levels.
Contributors: Nickolas Presel, ASA, MAAA; Matthew Morton, FSA, MAAA; Harrison Smith FSA, MAAA; Jon Forster, ASA, MAAA