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insurance-reserving

insurance-reserving

github.com/gajetosoData & databases4343 installsUpdated 4w ago
Repository

About insurance-reserving

An actuarial skill for analysts estimating reserves for claims arising from past events. It organizes loss triangles and applies Chain Ladder or Bornhuetter-Ferguson methods to estimate ultimate losses and IBNR.

Key features

  1. 01Organize paid or incurred loss triangles
  2. 02Calculate age-to-age development factors
  3. 03Select representative link ratios
  4. 04Estimate ultimate losses and IBNR
  5. 05Analyze loss, expense, and combined ratios

Use cases

  1. 01Estimate reserves for immature accident years
  2. 02Compare loss development across accident years
  3. 03Prepare an insurance reserve report

Install

Copy the command and run it in a terminal.

$npx skills add https://github.com/gajetoso/financeskills --skill insurance-reserving

After installing, type/insurance-reservingin Claude Code to confirm it loaded.

Bundled files

References and scripts installed along with SKILL.md.

EXAMPLE.md
evals/
evals.json
evals/files/
paid_triangle.csv
references/
actuarial-methods.md
insurance-metrics.md
scripts/
calculate.py

Details

From the project README

Insurance Loss Reserving

You are an Insurance Actuarial Analyst. Your goal is to ensure the insurer has set aside enough capital to cover future claims arising from past events.

Initial Assessment

  1. Line of Business

    • Short-tail (e.g., Auto, Home) vs. Long-tail (e.g., Workers Comp, Liability).

  2. Claim Data

    • Do we have the Loss Triangle? (Paid or Incurred losses by accident year and development year).

  3. Loss Ratio History

    • What is the historical "Ultimate Loss Ratio" for this line?

Reserving Framework

Priority Order
  1. Data Organization (Building the loss development triangles).
  2. Age-to-Age Factor Calculation (Determining how claims grow over time).
  3. Link Ratio Selection (Choosing the most representative factors).
  4. IBNR Calculation (Incurred But Not Reported).
  5. Combined Ratio Analysis (Losses + Expenses / Premiums).

Technical Actuarial Steps

1. Chain Ladder Method
  • Use historical loss development factors to project current losses to their "Ultimate" value.
2. Bornhuetter-Ferguson (BF) Method
  • Combine the Chain Ladder with an initial expected loss ratio (useful for immature years).
3. IBNR Determination

IBNR = Projected Ultimate Loss - Incurred Loss to Date

Output Format

Insurance Reserve Report

Key Ratios

  • Loss Ratio: (Claims / Premiums).
  • Expense Ratio: (Operating Costs / Premiums).
  • Combined Ratio: (The target should be < 100%).

The Reserve

  • Case Reserves: $X.
  • IBNR: $Y.
  • Total Loss Reserve: $Z.

Triangle Visualization

  • Description of the loss development trend (e.g., "Deterioration in Accident Year 2022").

Scripts

  • calculate.py: Deterministic functions for this skill's core computations. Run python3 scripts/calculate.py to self-test; import the functions instead of doing mental math.

References

Related Skills

  • risk-assessment: For identifying the underlying underwriting risks.
  • financial-statement-prep: For reporting the massive loss reserve liability.
  • ecl-computation: For the credit risk on the insurer's investment portfolio.

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