The Casualty Actuarial Society has set forth a set of standards which must be observed by C.A.S. licensed actuaries when conducting their studies
Data OrganizationAccident Date: Date that a loss occurred or is deemed by claims personnel to have occurred; Report Date: Date that a claim is first reported to the insurer; or Valuation Date: Date through which transactions may be included in the evaluation of the liability.
Data AvailabilityEnough data must be made available in a enough detail so that the actuary can properly assess reserves.
Emergence PatternsThe delay between the occurrence and recording of the claim
Settlement PatternsThe length of time that it takes for reported claims to settle
Development PatternsIt is important for there to be consistency in the settlement and reserving of claims.
Frequency and SeverityA high frequency of claim occurrences along with a low average claim size make reserve estimates more reliable.
Reopened Claims PotentialThe inclination of closed claims to reopen varies significantly from one line of business to the next and is effected substantially by claims department practices.
Operational ChangesChanges in computer systems or accounting, claims handling, or underwriting procedures can have an impact on loss experience.
ReasonablenessThe actuary should consider the relationship (ratio) between the loss estimate and some other loss independent measure such as premiums, exposures, or claims counts.
Loss Reserving MethodsAn actuary will usually look at the results of more than one loss reserving method when estimating the loss and loss adjustment expense liability for a specific group of claims.