The role of the Actuarial Function in monitoring the Best Estimate Liabilities computation

The present study analyzes and evaluates the role of the new Actuarial Function in coordination of Technical Provisions calculation, in order to check and to ensure the reliability and adequacy of the methods and models used as well as the underlying assumptions. It contributes to existing research literature by providing a practical description of a good and reliable examination of reserves which is required by the supervisors. It measures the sensitivity of the Best Estimate of claim provisions to the uncertainty arising from the volatility connected to the financial markets, from the unpredictability of the macro-economic trends and from the specifics of the insurance business area, including modelling error and estimation error. The results show how various loss reserving methods have performed given our reasonable expectations as to the future uncertainty in a real-world setting.