The mini-courses
Each mini-course has objectives, short lessons, a worked example on the series triangle, five self-assessment questions with instant feedback and readings from primary sources. The sixth is optional for those who work with IFRS 17.
Development triangles and diagnostics
How a triangle is built, what each type measures and how to read its factors by column, row and diagonal before choosing a method.
Chain ladder: factor selection and tail
Method assumptions, averages for selecting factors, tail estimation and reasonableness checks on the resulting IBNR.
Bornhuetter-Ferguson, Benktander and Cape Cod
Methods that blend reported losses with an expected loss ratio: how to choose it, how to iterate it and how to estimate it from the data.
Reserve variability: Mack and bootstrap
Process and parameter error, the Mack standard error, the ODP bootstrap and how to read percentiles without over-reading them.
Technical reserves in Mexico: LISF and CUSF
LISF articles 216 to 219, CUSF Title 5, best estimate, the 10% risk margin and the Annex 23.3.1 actuarial opinion.
IFRS 17: liability for incurred claims
Optional. Fulfilment cash flows, risk adjustment with a confidence level, the PAA exemption and claims development disclosure.
How to use the series
The recommended path is in order: mini-courses 1 to 3 cover the central IBNR estimate, 4 its variability, 5 the Mexican legal framework that turns that estimate into a technical reserve, and 6 the IFRS 17 version of the same liability.
If you already know the deterministic methods, you can start at 4. If you are preparing to practice in Mexico, 5 is essential. To practice with your own data, the IBNR methods comparison tool runs chain ladder, BF, Benktander, Cape Cod and the Mack error on any triangle, and the calculators section has a quick chain ladder.
Every legal reference was checked against the CNSF's official interactive version of the LISF and CUSF. The example data are fictitious and the figures were computed in code; the Mack error was validated against the Taylor and Ashe triangle.
The series triangle
A fictitious property and casualty insurer with five years of experience. Over the mini-courses you will see that this apparently stable triangle hides a question about how fast recent years are being reported.
| Accident year | 12 m | 24 m | 36 m | 48 m | 60 m | Earned premium |
|---|---|---|---|---|---|---|
| 2021 | 1,000 | 1,800 | 2,160 | 2,310 | 2,380 | 3,600 |
| 2022 | 1,100 | 2,050 | 2,420 | 2,570 | 3,800 | |
| 2023 | 1,250 | 2,300 | 2,780 | 4,100 | ||
| 2024 | 1,300 | 2,450 | 4,300 | |||
| 2025 | 1,450 | 4,600 |