Explain how three of the following elements can affect estimate of loss reserve.

Assignment Question(s):                                                    

Q1. Structures of insurance companies’ financial statements (income statement, balance sheet, cash flow statements) vary than structures the non- insurance organization due to the unique features of the insurance companies.

Give a sample of the structures for any selected Saudi insurance company’ financial statements and explain the rational for classifying balance sheet accounts. Write no less than 300 words (8 marks)

Q2. Explain how three of the following elements can affect estimate of loss reserve. Write no less than 300 words (7 marks)

The claims-handling process

Policy and exposure forms

Inflation

Legal trends

Environmental factors

Mix of claimants

Timeliness of claim reporting by claimants