Reserve Paid Outstanding Reconciliation Tool

Reconcile actual claim-by-claim incurred=paid+outstanding monetary ledger, signed deltas and explicit unknown IDs; no IBNR estimation, reserve adequacy or insurer statutory accounting rule.

Description

Claim reserve closure compares incurred with paid plus outstanding.

Claim reserve closure compares incurred with paid plus outstanding. Unknown evidence must be listed separately from genuine zero discrepancies.^[1]

The returned values include Signed claim reserve closure minor, Total known reserve closure minor, Claims without reserve evidence. The How section below explains the calculation, input rules and interpretation.

When to use Reserve Paid Outstanding Reconciliation Tool

Use Reserve Paid Outstanding Reconciliation Tool when you need to evaluate the supplied records under the calculation and evidence rules below. No IBNR estimate, reserve adequacy or statutory accounting rule is supplied.

Prepare the observed policy, claim or quote evidence and independently verified policy tables. Monetary fields use integer minor units in one currency: for a currency with 100 minor units per major unit, enter 12345 for 123.45. One basis point is 0.01 percentage points, so 10000 basis points represents 100%.

How to use Reserve Paid Outstanding Reconciliation Tool and understand its results

Prepare the observed policy, claim or quote evidence and independently verified policy tables. Monetary fields use integer minor units in one currency: for a currency with 100 minor units per major unit, enter 12345 for 123.45. One basis point is 0.01 percentage points, so 10000 basis points represents 100%.
Enter claimIds, observedIncurredReserveMinor, observedPaidLossMinor, observedOutstandingReserveMinor, reserveEvidenceFlags using the field table and calculation rules, then run the tool.
Read signedClaimReserveClosureMinor, totalKnownReserveClosureMinor, claimsWithoutReserveEvidence. The explanation below defines the units, signs, ordering and any flags or placeholder values.
If the tool reports an input issue, correct the values and run it again. Apply the stated assumptions when interpreting a successfully returned result.

Input field	Meaning	Value type; see rules below	Requirement
claimIds	Claim ids	list of string	Required
observedIncurredReserveMinor	Observed incurred reserve minor	list of number	Required
observedPaidLossMinor	Observed paid loss minor	list of number	Required
observedOutstandingReserveMinor	Observed outstanding reserve minor	list of number	Required
reserveEvidenceFlags	Reserve evidence flags	list of number	Required

Enter aligned nonempty unique nonblank claim IDs, integer money lists 0–10¹² per entry and binary evidence flags. Return signed deltas, safe-integer total closure and IDs lacking evidence. Zero is a placeholder for unknown deltas, not proof of reconciliation.

delta_i=evidence_i?(incurred_i−paid_i−outstanding_i):0; total=sum(knownDeltas)

Units, indexing, boundary conditions and exceptional cases are defined in the calculation rules above.

Output field	Meaning	Value type
signedClaimReserveClosureMinor	Signed claim reserve closure minor	list of number
totalKnownReserveClosureMinor	Total known reserve closure minor	number
claimsWithoutReserveEvidence	Claims without reserve evidence	list of string

json

{
  "input": {
    "claimIds": [
      "a",
      "b"
    ],
    "observedIncurredReserveMinor": [
      10000,
      20000
    ],
    "observedPaidLossMinor": [
      3000,
      5000
    ],
    "observedOutstandingReserveMinor": [
      7000,
      14000
    ],
    "reserveEvidenceFlags": [
      1,
      1
    ]
  },
  "output": {
    "signedClaimReserveClosureMinor": [
      0,
      1000
    ],
    "totalKnownReserveClosureMinor": 1000,
    "claimsWithoutReserveEvidence": []
  }
}

Limitations and assumptions

No IBNR estimate, reserve adequacy or statutory accounting rule is supplied.

Numeric inputs, where present, must be finite. Follow the calculation-specific rules for overflow, underflow and exceptional cases. Numeric lists are limited to 10,000 entries; string lists to 128 strings of at most 128 characters each. The rules above may impose smaller limits. Missing required fields, extra fields, wrong value types and violations of the calculation rules are input errors.

Alternative or Complementary methods

Use Subrogation Recovery Success Rate Percent Calculator: Subrogation success should use resolved cases as its denominator. Unresolved cases remain censored, and recovery costs form a separate ledger. For a complementary task, use Quota Share Ceding Commission Net Retained Calculator: Quota-share allocation cedes the same stated fraction of premium and loss. Ceding commission applies to rounded ceded premium.

References

Reserve Paid Outstanding Reconciliation Tool — tool.io

Similar or alternative tools

Subrogation Recovery Success Rate Percent Calculator
Subrogation success should use resolved cases as its denominator. Unresolved cases remain censored, and recovery costs form a separate ledger.
Quota Share Ceding Commission Net Retained Calculator
Quota-share allocation cedes the same stated fraction of premium and loss. Ceding commission applies to rounded ceded premium.