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Loss Development (IBNR) Calculator Project ultimate losses and IBNR by accident year with age-to-ultimate loss development factors (chain ladder).
How the loss development (ibnr) calculator works Reported losses on recent accident years are incomplete. Loss development factors project them to their ultimate value; the difference is IBNR — incurred but not (enough) reported.
Formula Ultimate = Reported losses × Age-to-ultimate factor. IBNR = Ultimate − Reported.
How to use it List each accident year with reported losses. Enter the age-to-ultimate factor for that year’s maturity. Optionally add earned premium for ultimate loss ratios. Worked example 2025 reported losses of $520K with a 2.70 factor project to $1.404M ultimate — $884K IBNR.
Frequently asked questions Where do development factors come from? From a loss triangle of the book’s own history, or from industry benchmarks when the book is too small.
Why is the latest year so uncertain? Its factor is the largest, so small changes in reported losses swing the ultimate a lot.
Guides
Related calculators Loss Run Analyzer — Analyze a multi-year loss run: loss ratio by year, 3- and 5-year loss ratios, frequency and severity.Loss Trend Calculator — Trend historical losses to a future policy period with an annual trend rate and exact trend period.Loss Ratio Calculator — Calculate the insurance loss ratio (incurred losses ÷ earned premium), with or without LAE, against a target.