Exam 5: Ultimate, unpaid and IBNR are related but different

Ultimate claims describe the total expected cost. Total unpaid subtracts paid claims. IBNR on a reported-claims basis subtracts reported claims, which include paid and case reserves. A problem’s expense and recovery basis must remain consistent throughout.

Worked example or practice scenario

Ultimate claims are 1,200, paid claims 700 and case reserves 300. Reported claims are 1,000. Total unpaid is 500; IBNR is 200. The identity is unpaid = case reserves + IBNR, on this simplified consistent basis.

Try this next

Reconcile all four amounts in one row. Then ask whether the provided triangle is paid or incurred. Do not subtract case reserves again if they are already included in reported claims.

Reading sources

• Official syllabus and resources

ActNet editorial guide · October 1, 2026 · Original illustrative examples.