Unexpired risk reserve

Document description

The only formula I have ever seen for calculating the URR (and the one applied by the DTI) basically requires that the total premium reserves at the end of a year should be:- (Claims ratio for the year) x (Unearned premiums at end of the year). If the result exceeds the Unearned Premium Reserve (UPR) then the difference must be set up as URR. This seems unobjectionable until one analyses the components of each term.