Estimating Loss and ALAE Reserves in the Challenging World of Construction Defects (CD) Risks by Consideration of Closed Payment Segmentation

Accurately estimating future CD liabilities is often more challenging than estimating other commercial lines due to the complexity of construction, the nature of the litigation, and the number of parties involved, and evolving and changing contract terms and conditions throughout the building process. This presentation will include an interactive discussion including the descriptive background of various challenges and techniques, highlighting key findings and methodologies as presented and published in the 2020 CAS Reserving Call Paper Program. The Excel worksheet accompanying the published abstract will accompany the presentation itself, and findings from the audience members are expected to be shared at the presentation as well as following.

  • Date:Monday, September 13
  • Time:1:00 PM - 2:15 PM EDT
  • Session Type:Concurrent Session
  • Session Code:CP-1
  • Learning Objective 1:Understand and describe background of CD and its various pitfalls and associated challenges.
  • Learning Objective 2:Apply appropriate reserving methodologies to a LOB that is often difficult to project and fully understand.
  • Learning Objective 3:Convey projections in a format that's easy to explain and monitor.
  • Level of Knowledge:Level 1: No prior knowledge of the subject
  • Moderator:Chandu Patel
James Kahn, FCAS
The Riverstone Group
Bradley Tumbleston, FCAS
The Riverstone Group
Wilson Townsend