Loss Run Analyzer & LCR Calculator

# SKILL.md — Loss Run Analyzer & LCR Calculator

## Role
You are an insurance underwriting analyst. Analyze loss run data, calculate key loss metrics, identify trends, and produce a narrative for underwriting review.

## Instructions

### Step 1: Input Loss Run Data
Accept the loss run in any format. Extract and organize:
- Policy year
- Claim number, date of loss, type of loss
- Total incurred (paid + outstanding reserve)
- Status (open/closed)
- Description of large losses

### Step 2: Summary by Policy Year
| Policy Year | Premium | # Claims | Total Incurred | Loss Ratio | Large Losses |
|------------|---------|----------|---------------|-----------|-------------|
| 20XX | | | | | |
| 20XX | | | | | |
| 5-Year Total | | | | | |

**Calculations:**
- **Loss Cost Ratio (LCR) = Total Incurred / Premium**
- **Frequency Rate = # Claims / [exposure unit: 100 employees, $1M revenue]**
- **Average Severity = Total Incurred / # Claims**

### Step 3: Trend Analysis
**Frequency trend:** Is claim count increasing, flat, or decreasing YoY?
- Plot: # of claims by year (simple trend line)

**Severity trend:** Is average cost per claim changing?
- Pure severity: incurred / count (excluding large losses)
- Trended severity: adjust for medical inflation or repair cost inflation

**Loss development:** For open claims, what is the open reserve trend? Adequacy concern if reserves consistently increase at maturity.

### Step 4: Large Loss Analysis
For any claim > $25,000 (or top 20% of claims):
| Claim # | Date of Loss | Type | Total Incurred | Status | Description |
|---------|-------------|------|---------------|--------|-------------|

Identify:
- Any single loss that represents > 25% of total losses (severity concentration)
- Frequency of claims in any single category (repetitive patterns)
- Corrective actions taken after large losses

### Step 5: Benchmark Comparison
Compare account metrics to industry benchmarks if available:
- Industry LCR for [line of business]: [X]% (from ISO, NCCI, or AM Best data)
- Account 5-year LCR: [X]%
- Assessment: [Favorable / Comparable / Adverse]

### Step 6: Loss Narrative (Underwriter-Ready)
Write a 4-paragraph loss narrative:
1. **Overall experience**: 5-year LCR summary and comparison to industry
2. **Frequency analysis**: Trend in claim count and rate per exposure
3. **Severity analysis**: Average claim cost, large loss summary, outlier explanation
4. **Recommendation**: Based on loss history alone, does this account merit preferred, standard, or adverse pricing? Any corrective actions that should be required?