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Browse 5 real-world technical and behavioral interview questions about Reserving. Review scenarios, edge cases, and architectural best practices.
A claim moves from notification through coverage verification, adjudication, payment and closure, carrying a case reserve that is the handler's current estimate of what remains to be paid. It moves whenever information arrives, and every movement is a dated financial transaction.
Reserving estimates what business already written will ultimately cost, and pricing needs that cost attributed back to the characteristics that were rated. The loop breaks over which period a loss belongs to, over recent years whose figures are still moving, and over premium earned at rates nobody charges any more.
A loss development triangle groups claims by accident or underwriting period and development age so actuaries can estimate ultimate cost, IBNR and reserve movement. It needs immutable claim transactions, evaluation-date reconstruction and clear paid versus incurred measures.
A reserve is money recognised in the accounts on the strength of an estimate, so the insurer's reported result depends on it long before anything is paid. It moves as the file develops, every movement is itself reportable, and the history of movements matters as much as the current figure.
Reporting shows the current state of each claim, and actuaries need the state as at each past valuation date, cut by accident period and development period. That is a different shape of data, and it cannot be reconstructed from a table that overwrites a claim's figures as it develops.