2020 loss reserve discount factors for insurers released by IRS

On Nov. 4, 2020, the Internal Revenue Service (IRS) released Revenue Procedure 2020-48, which contains the discount factors for the 2020 accident years for use by insurance companies in computing discounted unpaid losses and discounted estimated salvage recoverable.

Tables 3 and 4 provided for in this revenue procedure present the discount factors for each line of business for losses incurred in the 2020 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.

For more information on unpaid loss and salvage discount factors, or to learn how Baker Tilly’s insurance industry Value Architects™ can assist your organization, contact our team.