Insurance
Reserve Increase — Adverse Claims Development
Increasing a case reserve when new information indicates the claim will cost more than initially estimated.
| Account Name | Type | Debit ($) | Credit ($) |
|---|---|---|---|
| Claims Expense (Reserve Strengthening) | Expense (+) | 20,000.00 | - |
| Outstanding Claims Reserve | Liability (+) | - | 20,000.00 |
💡 Accountant's Note
Claims development is the process by which initial reserves are refined over time. Adverse development (reserve strengthening) is common for bodily injury and liability claims where final costs are uncertain.
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