Application of chain ladder method for traffic insurance in Turkey

In this thesis, firstly, the history of chain ladder method which is one of the reserving methods is mentioned. Then, the concepts used in claims reserving are described. Finally, chain ladder method is studied and the reserves for the outstanding claims are estimated with respect to the data of claim payments which are taken from TRAMER (Motor TPL Insurance Information Center) using Chain ladder method, Inflation-adjusted chain ladder method and Loss ratio method. In addition, other reserving methods are described like Separation technique, Average cost per claim method, The loss ratio and Bornheutter-Ferguson method, Operational time model and The bootstrap method.In application, firstly, the produced premium amounts for traffic insurance between 2003 and 2009 years are investigated according to the data taken from TRAMER on 14.03.2010. Then, a reserving method which is calculable easier is developed with respect to the figure of claim payments in 2003 and 2004 against to the chain ladder method to estimate reserve for outstanding claims. Finally, the estimates obtained from both chain ladder method and the developed method are compared with the actual values published in TRAMER on 07.08.2011.