- 32 -
Tillinghast ever explicitly refused to consider any particular
factor in estimating petitioner’s unpaid losses.
Furthermore, there is no evidence in the record of any
actuarial standard that supports an “implied range” of plus or
minus 10 percent around an actuary’s point estimate. To the
contrary, Reichle testified that although the concept of an
implied range of reasonableness is consistent with the
uncertainty inherent in any particular point estimate of unpaid
losses, it is impossible to quantify generally how wide such a
range would be, since the width of the range would depend upon
the confidence level demanded.19
Reichle testified somewhat tentatively that “I guess in the
case at hand, our view was that * * * If a company carried a
reserve in their annual statement within ten percent of our
estimate, * * * that was reasonable.” Reichle also testified,
however, that any such implied range had to be determined on a
“company-by-company and case-by-case basis” and that he “wouldn’t
want to quite generalize it * * * within the industry and that
kind of thing”. Reichle offered no specifics as to what factors
he might have considered in arriving at a conclusion that a 10-
percent implied range was reasonable in the instant case or what
confidence level such a range might imply. Consequently, the
19 In other words, the width of the implied range would
approach infinity as the confidence level approached zero.
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