Timothy C. Mosler
Joseph A. Herbers
Christina L. Negley
Erich A. Brandt
Laura A. Maxwell
Arthur R. Randolph II
Robert J. Walling III
Darcie R. Truttmann
Gregory W. Fears, Jr.
Aaron N. Hillebrandt
Christopher J. Schubert
Derek W. Freihaut
Ken J. Hawkins
Nicholas E. Alicea
Pinnacle continues to do a great job for the IAT Group. They are always readily available and very responsive to our needs.
Pinnacle consultants deal with auditors daily, assisting them in serving their customers and evaluating the work products of other actuaries.
Pinnacle strives to construct benchmarks for any analysis, whether ratemaking, loss reserving or some other use, as close as possible to replicating the nature of the underlying data being reviewed.
Pinnacle provides loss reserve analyses and other
diagnostics in support of collateral negotiations associated with deductible
and/or self-insured retentions.
Assessing the reasonableness of indicated loss and loss adjustment expense reserves after the analysis is completed is an essential element of the loss reserve analysis. In particular, measures such as loss ratios, changes since the prior evaluation, implied claim frequencies and severities and costs per unit of exposure are a few of the diagnostic tests employed when considering the reasonableness of indicated reserves.
Management sometimes wishes to reflect the time value of money in funding projections, accruals for unpaid claims liabilities and other valuations. The two most important parameters for doing so are the assumed interest rate and the underlying claim payment pattern. Assessing reasonable values for these parameters is not trivial as the interest rate may need an adjustment for risk while the claim payment pattern may not be readily available.
Loss reserving is a process of estimating reasonable accruals for the unpaid loss and loss adjustment expenses that must be posted on a balance sheet. As this is often times the largest liability in a company’s financials, the accrual has a very significant impact on income and surplus (or net worth).
Pinnacle tailors our analysis of indicated reserves to your particular situation. Our loss reserve analyses are used to support statements of actuarial opinion (SAOs), audit opinions, financial examinations, insurance company liquidations and rehabilitations and as expert opinions in lawsuits. We rely on a wide variety of traditional actuarial methods to develop reasonable estimates of unpaid claims liabilities. The results of such a study can be stated as a point estimate, a reasonable range of outcomes or as a statistical distribution of all possible outcomes.
There are many factors that influence the analysis of indicated reserves, including internal factors such as safety programs, loss control efforts or management changes.
There are external influences as well - regulatory/judicial climate, the economy or weather patterns. Our consultants spend considerable time and effort to understand the unique climate in which your company operates before customizing our analysis to include the real world influences likely to influence the true accrual for unpaid claims liabilities. We also have significant expertise with insurer liquidators and rehabilitators.
Our experience with property/casualty insurance programs is both broad and deep, with no two programs alike. From financial analysis of companies and their management to expert witness testimony regarding our findings and recommendations, you can rely on our support.
December 2019 APEX
Three Perspectives on Peer Review
Authored by Erich A. Brandt and Darcie R. Truttmann.
July 2019 APEX Webinar
Causes of Recent Reserve Development
Authored by Erich A. Brandt and Gregory W. Fears, Jr..
See More »
Pinnacle provides the loss reserve analysis and statement of actuarial opinion to the Bermuda-domiciled captive of a major national long haul trucking company for over a decade. This reserve analysis examined the captive's coverages for excess automobile liability coverage, deductible reimbursement under a large deductible workers compensation policy and cargo liability and physical damage coverages. The analysis utilized both company loss development triangles and industry benchmarks. Once the reserve analysis was completed and discussed with the client, the statement of actuarial opinion was produced to comply with regulatory requirements. Our excellent working relationship with the captive’s auditors simplifies the work of both firms on behalf of the captive.
Liquidation - Workers Compensation
Pinnacle was retained by the liquidator of a monoline workers' compensation carrier to estimate outstanding liabilities and provide expert testimony in support of the loss reserve estimation.
Self Insured Loss Reserve Analysis
Pinnacle was approached by a major, national manufacturer to perform a loss reserve analysis of their retained workers compensation, auto liability, general liability and products liability loss exposures. The previous actuary worked for a large broker which the customer felt presented a conflict of interest. In addition, the actuary used industry benchmarks that the customer felt did not accurately represent their loss development behavior. Pinnacle worked with the customer to better understand their loss exposures, claims handling practices, and corporate risk management philosophy. We worked with the company to gather better internal data and refine the industry benchmarks to better reflect their third party administrator, industry focus and geographic mix. These refinements, and many others, led to a more accurate analysis of the company’s retained loss exposures, a reduced provision for unpaid claims on their balance sheet, and reduced collateral requirements from their fronting carrier.
At Pinnacle, we partner with you to explore whatever path it takes to find the answers you need.
February 18, 2021
February APEX Webinar -
Predictor Selection in a Multi-Dimensional World