Reserves from accident years before 1999 represent approximately 14% of industry loss reserves. These liabilities have consistently increased over time and are largely in workers compensation and several liability product segments. In the report, Fitch assesses changes in composition, claims development trends, and loss payment history of prior period reserves using statutory data from 1999-2008.
The report also considers the difficulty in estimating ultimate loss development factors in projecting insurer's reserve adequacy due to data constraints. Fitch's longer term compilation of company and industry aggregate implied tail factors by business segment provides greater perspective in assessing reserve strength in longer tail liabilities.
To access this Special Report, 'Analysis of Prior Period Loss Reserves and Tail Factors' please visit www.fitchratings.com under Insurance > Special Reports.