What Does Development Factor Mean?

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What does Development Factor mean? Read on to discover the definition & meaning of the term Development Factor - to help you better understand the language used in insurance policies.

Development Factor

Development Factor

A factor applied to losses before they are fully matured to account for loss development and incurred but not reported (IBNR) claims. Factors are derived from historical data to reflect actual trends in loss development.

We hope the you have a better understanding of the meaning of Development Factor.

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