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Accident Year Data

Definition

A method of arranging loss and exposure data of an insurer or group of insurers or within a book of business, so that all losses associated with accidents occurring within a given calendar year and all premium earned during that same calendar year are compared. Thus, regardless of individual policy periods and regardless of when a loss is reported or is paid, accident year data 2015 will include all premiums earned during 2015 and will include all losses occurring in 2015. Rate-making organizations use both accident year data and policy year data in their analyses of rate adequacy. For example, workers compensation loss development factors (LDFs) promulgated by the National Council on Compensation Insurance (NCCI) are developed from accident year data.

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