Munich Chain Ladder: A Reserving

Method that Reduces the Gap

between IBNR Projections Based on
Paid Losses and IBNR Projections
Based on Incurred Losses
by Gerhard Quarg and Thomas Mack

REPRINT ACKNOWLEDGMENT

Munich Chain Ladder by Dr. Quarg and Dr. Mack is

being reprinted in Variance to give this important paper
wider visibility within the actuarial community. The editors of Variance invited the authors to submit their paper
for republication because we believe that the techniques
described in their work should be known to all actuaries
doing reserve analysis. We also hope to stimulate further
research in this area. This paper is reprinted from Bltter
der Deutschen Gesellschaft fr Versicherungs- und Finanzmathematik, volume 26, number 4, 2004, pages 597630.
We thank the editors of that journal and the authors for
allowing Variance to publish the paper.

KEYWORDS
Reserving methods, chain ladder, loss development, reconciliation of paid
and incurred projections

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