How are the grossing-up factors calculated from a delay table? In this example: l_x = # IBNR claims at beginning of the month d_x = # claims reported during month where l_0 = 1,000 d_0 = 250 therefore grossing-up factor = 250/1000 = 0.25 also l_1 = 750 d_1 = 375 and the grossing-up factor = 0.625 I do not understand how the last grossing-up factor is calculated. Can someone explain please? Thank you.
Hi ActuarialStudent, At 31st Dec, for claim events occurring in November, we are at the end of month 1. Therefore the index tells us that the cumulative number of claims reported so far (as a percentage of the ultimate number of claims) is (250+375)/1000 = 62.5%. Kind regards, Katherine.
