Government building pillars with American flag

2021 loss reserve discount factors for insurers released by IRS

On Dec. 13, 2021, the Internal Revenue Service (IRS) released Revenue Procedure 2021-54, which contains the discount factors for the 2021 accident years for use by insurance companies in computing discounted unpaid losses and discounted estimated salvage recoverable. After discovering an error in the originally released factors on Rev. Proc. 2021-54, Table 4, the IRS has recently revised the 2021 discount factors in Internal Revenue Bulletin 2021-52.

Tables 3 and 4 provided for in this revenue procedure present the discount factors for each line of business for losses incurred in the 2021 and earlier accident years. This revenue procedure applies to any insurance company that is required to discount unpaid losses under Internal Revenue Code (IRC) section 846 or that is required to discount estimated salvage recoverable under IRC section 832.

Man Du
Conference room in advance of board meeting
Next up

Updates from the Statutory Accounting Principles Working Group’s Dec. 11 Fall National meeting