Bornhuetter-Ferguson technique

Term · Insurance and risk management · MLC-T-INS-000596

An actuarial method used to estimate ultimate claim liabilities, particularly for long-tailed lines of business where claims develop slowly over time. It combines actual paid or incurred losses to date with an expected loss ratio for the undeveloped portion of the claims. This technique is often applied when early claim development patterns are not yet stable or credible, providing a more stable estimate than other methods.

Table 1. Record
Identifier	MLC-T-INS-000596
Field	Insurance and risk management

Record as JSON

{
  "id": "MLC-T-INS-000596",
  "term": "Bornhuetter-Ferguson technique",
  "field": "Insurance and risk management",
  "definition": "An actuarial method used to estimate ultimate claim liabilities, particularly for long-tailed lines of business where claims develop slowly over time. It combines actual paid or incurred losses to date with an expected loss ratio for the undeveloped portion of the claims. This technique is often applied when early claim development patterns are not yet stable or credible, providing a more stable estimate than other methods.",
  "url": "https://mlchart.com/terminology/insurance/bornhuetter-ferguson-technique/"
}

Record 368 of 3,748 in Insurance and risk management terminology (MLC-0106). Request the full dataset.