Rev. Rul. 88-63

1988-2 C.B. 130, 1988-31 I.R.B. 5.

                       Internal Revenue Service

                                 Revenue Ruling

         INSURANCE COMPAINES; LOSS RESERVES; DISCOUNTING UNPAID LOSSES

                           Published: August 1, 1988

SECTION 846. - DISCOUNTED UNPAID LOSSES DEFINED

  Insurance companies; loss reserves; discounting unpaid losses. The loss payment patterns and discount factors are set forth for calendar year 1988 for each property and casualty business to be used in discounting the deduction for loss reserves for purposes of section 846 of the Code.

  For purposes of section 846 of the Internal Revenue Code, the following are the loss payment patterns and discount factors for calendar year 1988 for each property and casualty line of business to be used in discounting the deduction for loss reserves. Section 846 requires all property and casualty loss reserves (unpaid losses and unpaid loss adjustment expenses) for each line of business (as shown on the annual statement approved by the National Association of Insurance Commissioners (NAIC)) to be discounted for federal income tax purposes. The discount factors were determined by using an interest rate for 1988 of 7.77 percent, the interest rate determined under section 846(c).

                              DRAFTING INFORMATION

  The principal author of this revenue ruling is Katherine A. Hossofsky of the Corporation Tax Division. For  further information regarding this revenue ruling contact Ms. Hossofsky on (202) 566-4196 (not a toll-free call).

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******** This is piece 1. -- It begins at character 1 of table line 1. ********

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                                                           Cumulative

                          Loss & loss    Total losses and  fraction of

Years before  Year loss  to date (000s)  incurred (000s)    (percent)

COMPOSITE SCHEDULE P

AY + 0          1985        27050900         78832067        34.3146

AY + 1          1984        42762165         70059326        61.0371

AY + 2          1983        46304723         62932278        73.5787

AY + 3          1982        46339283         56724398        81.6920

AY + 4          1981        44014354         50826873        86.5966

AY + 5          1980        41790830         46281924        90.2962

AY + 6          1979        38531049         41768331        92.2494

AY + 7          1978        33285121         35572301        93.5703

AY + 8          1977        29524057         31225532        94.5510

AY + 9          1976        26745914         28167858        94.9519

AY + 10       Pre 1976     184257188        188825255          NA

AY + 11          NA            NA               NA             NA

AY + 12          NA            NA               NA             NA

AY + 13          NA            NA               NA             NA

AY + 14          NA            NA               NA             NA

AY + 15          NA            NA               NA             NA

1...+...10....+...20....+...30....+...40....+...50....+...60....+...70.

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******* This is piece 2. -- It begins at character 72 of table line 1. ********

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Fraction of   Fraction of  Discounted       Reserve

   loss paid  loss unpaid,  fraction        discount

   (percent)     (percent)  end (percent)  (percent)

     34.3146       65.6854  54.8557          83.5127

     26.7225       38.9629  31.3767          80.5296

     12.5416       26.4213  20.7950          78.7052

      8.1133       18.3080  13.9881          76.4042

      4.9046       13.4034  9.9834           74.4839

      3.6996        9.7038  6.9183           71.2961

      1.9532        7.7506  5.4283           70.0375

      1.3209        6.4297  4.4788           69.6588

       .9807        5.4490  3.8088           69.8986

       .4009        5.0481  3.6885           73.0679

       .4009        4.6472  3.5590           76.5829

       .4009        4.2464  3.4194           80.5246

       .4009        3.8455  3.2689           85.0059

       .4009        3.4446  3.1067           90.1909

       .4009        3.0437  2.9319           96.3277

      3.0437         .0000  .0000            96.3277

72.....80....+...90....+....0....+...10....+...20...

[Note:  The following TABLE/FORM is too wide to be displayed on one screen.

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******** This is piece 1. -- It begins at character 1 of table line 1. ********

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COMPOSITE SCHEDULE P                                       Cumulative

                          Loss & loss    Total losses and  fraction of

Years before  Year loss  to date (000s)  incurred (000s)    (percent)

AUTOMOBILE LIABILITY

AY + 0          1985        10734519         31281287        34.3161

AY + 1          1984        18397279         28217053        65.1992

AY + 2          1983        20047428         24986353        80.2335

AY + 3          1982        19808529         22243403        89.0535

AY + 4          1981        18974882         20225872        93.8149

AY + 5          1980        17105852         17717217        96.5493

AY + 6          1979        16266022         16633374        97.7915

AY + 7          1978        14534843         14766868        98.4287

AY + 8          1977        12853464         13027563        98.6636

AY + 9          1976        11389407         11506437        98.9829

AY + 10       Pre 1976      91306371         91545925          NA

AY + 11          NA            NA               NA             NA

AY + 12          NA            NA               NA             NA

AY + 13          NA            NA               NA             NA

1...+...10....+...20....+...30....+...40....+...50....+...60....+...70.

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******* This is piece 2. -- It begins at character 72 of table line 1. ********

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Fraction of   Fraction of  Discounted       Reserve

   loss paid  loss unpaid,  fraction        discount

   (percent)     (percent)  end (percent)  (percent)

     34.3161       65.6839  58.0977          88.4505

     30.8830       34.8008  30.5515          87.7895

     15.0344       19.7665  17.3178          87.6120

      8.8200       10.9465  9.5072           88.8514

      4.7614        6.1851  5.3030           85.7378

      2.7344        3.4507  2.8763           85.3559

      1.2422        2.2085  1.8103           81.9700

       .6373        1.5713  1.2894           82.0635

       .2349        1.3364  1.1458           85.7381

       .3193        1.0171  .9033            88.8171

       .3193         .6978  .6421            92.0143

       .3193         .3785  .3605            95.2420

       .3193         .0592  .0570            96.3277

       .0592         .0000  .0000            96.3277

72.....80....+...90....+....0....+...10....+...20...

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******** This is piece 1. -- It begins at character 1 of table line 1. ********

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                                                           Cumulative

                          Loss & loss    Total losses and  fraction of

Years before  Year loss  to date (000s)  incurred (000s)    (percent)

OTHER LIABILITY

AY + 0          1985         824218          8957695         9.2012

AY + 1          1984        1752555          6901148         25.3951

AY + 2          1983        2493908          6222045         40.0818

AY + 3          1982        3181315          5762517         55.2070

AY + 4          1981        3429366          5180556         66.1969

AY + 5          1980        3548964          4724863         75.1125

AY + 6          1979        3339115          4162493         80.2191

AY + 7          1978        3050437          3610079         84.4978

AY + 8          1977        2812829          3245716         86.6628

AY + 9          1976        2702169          3081827         87.6807

AY + 10       Pre 1976      23480898         25101360          NA

AY + 11          NA            NA               NA             NA

AY + 12          NA            NA               NA             NA

AY + 13          NA            NA               NA             NA

AY + 14          NA            NA               NA             NA

AY + 15          NA            NA               NA             NA

1...+...10....+...20....+...30....+...40....+...50....+...60....+...70.

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******* This is piece 2. -- It begins at character 72 of table line 1. ********

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Fraction of   Fraction of  Discounted       Reserve

   loss paid  loss unpaid,  fraction        discount

   (percent)     (percent)  end (percent)  (percent)

      9.2012       90.7988  68.4914          75.4321

     16.1939       74.6049  57.0020          76.4051

     14.6867       59.9182  46.1844          77.0791

     15.1252       44.7930  34.0711          76.0635

     10.9898       33.8031  24.3096          74.8736

      8.9157       24.8875  18.0206          72.4084

      5.1066       19.7809  14.1196          71.3799

      4.2787       15.5022  10.7749          69.5054

      2.1650       13.3372  9.3645           70.2135

      1.0179       12.3193  9.0354           73.3437

      1.0179       11.3013  8.6807           76.8114

      1.0179       10.2834  8.2985           80.6977

      1.0179        9.2655  7.8865           85.1173

      1.0179        8.2475  7.4426           90.2398

      1.0179        7.2296  6.9641           96.3277

      7.2296         .0000  .0000            96.3277

72.....80....+...90....+....0....+...10....+...20...

[Note:  The following TABLE/FORM is too wide to be displayed on one screen.

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******** This is piece 1. -- It begins at character 1 of table line 1. ********

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                                                           Cumulative

                          Loss & loss    Total losses and  fraction of

Years before  Year loss  to date (000s)  incurred (000s)    (percent)

WORKERS' COMPENSATION

AY + 0          1985        3932938          15174769        25.9176

AY + 1          1984        7635807          14004437        54.5242

AY + 2          1983        8124465          11973169        67.8556

AY + 3          1982        8126215          10749254        75.5979

AY + 4          1981        8203632          10245226        80.0727

AY + 5          1980        7893190          9444281         83.5764

AY + 6          1979        7559441          8845526         85.4606

AY + 7          1978        6621807          7594942         87.1871

AY + 8          1977        5981586          6744498         88.6884

AY + 9          1976        5510811          6170361         89.3110

AY + 10       Pre 1976      46351166         48577936          NA

AY + 11          NA            NA               NA             NA

AY + 12          NA            NA               NA             NA

AY + 13          NA            NA               NA             NA

AY + 14          NA            NA               NA             NA

AY + 15          NA            NA               NA             NA

1...+...10....+...20....+...30....+...40....+...50....+...60....+...70.

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******* This is piece 2. -- It begins at character 72 of table line 1. ********

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Fraction of   Fraction of  Discounted       Reserve

   loss paid  loss unpaid,  fraction        discount

   (percent)     (percent)  end (percent)  (percent)

     25.9176       74.0824  59.2191          79.9368

     28.6066       45.4758  34.1233          75.0361

     13.3314       32.1444  22.9350          71.3499

      7.7423       24.4021  16.6795          68.3530

      4.4748       19.9273  13.3302          66.8941

      3.5037        3.5037  16.4236          65.3247

      1.8842       14.5394  9.6062           66.0705

      1.7264       12.8129  8.5604           66.8105

      1.5013       11.3116  7.6670           67.7796

       .6226       10.6890  7.6163           71.2540

       .6226       10.0664  7.5618           75.1191

       .6226       10.0664  7.5618           79.4490

       .6226        9.4438  7.5030           84.3382

       .6226        8.1985  7.3713           89.9101

       .6226        7.5759  7.2977           96.3277

      7.5759         .0000  .0000            96.3277

72.....80....+...90....+....0....+...10....+...20...

[Note:  The following TABLE/FORM is too wide to be displayed on one screen.

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******** This is piece 1. -- It begins at character 1 of table line 1. ********

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                                                           Cumulative

                          Loss & loss    Total losses and  fraction of

Years before  Year loss  to date (000s)  incurred (000s)    (percent)

MEDICAL MALPRACTICE

AY + 0          1985         85689           2835465         3.0220

AY + 1          1984         312207          2404595         12.9838

AY + 2          1983         534322          2280478         23.4303

AY + 3          1982         745691          2095689         35.5821

AY + 4          1981         836834          1839826         45.4844

AY + 5          1980         846392          1574497         53.7563

AY + 6          1979         800223          1316417         60.7880

AY + 7          1978         745973          1109154         67.2560

AY + 8          1977         639578           883594         72.3837

AY + 9          1976         627818           835753         75.1200

AY + 10       Pre 1976      1959501          2323449           NA

AY + 11          NA            NA               NA             NA

AY + 12          NA            NA               NA             NA

AY + 13          NA            NA               NA             NA

AY + 14          NA            NA               NA             NA

AY + 15          NA            NA               NA             NA

1...+...10....+...20....+...30....+...40....+...50....+...60....+...70.

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******* This is piece 2. -- It begins at character 72 of table line 1. ********

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Fraction of   Fraction of  Discounted       Reserve

   loss paid  loss unpaid,  fraction        discount

   (percent)     (percent)  end (percent)  (percent)

      3.0220       96.9780  65.1523          67.1826

      9.9617       87.0162  59.8731          68.8069

     10.4465       76.5697  53.6805          70.1067

     12.1519       64.4179  45.2364          70.2233

      9.9023       54.5156  38.4714          70.5696

      8.2719       46.2437  32.8734          71.0873

      7.0316       39.2120  28.1280          71.7330

      6.4681       32.7440  23.5988          72.0708

      5.1277       27.6163  20.1093          72.8169

      2.7363       24.8800  18.8312          75.6881

      2.7363       22.1436  17.4537          78.8204

      2.7363       19.4073  15.9692          82.2844

      2.7363       16.6709  14.3693          86.1938

      2.7363       13.9346  12.6451          90.7464

      2.7363       11.1982  10.7870          96.3277

     11.1982         .0000  .0000            96.3277

72.....80....+...90....+....0....+...10....+...20...

[Note:  The following TABLE/FORM is too wide to be displayed on one screen.

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******** This is piece 1. -- It begins at character 1 of table line 1. ********

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                                    Cumulative     Fraction    Fraction

                                                         of          of

                  Loss &   Total    fraction of   loss paid        loss

                   loss    losses                               unpaid,

                            and

Years      Year     to    incurred   (percent)    (percent)   (percent)

  before   loss    date    (000s)

                   (00-

                   0s)

1...+...10....+...20....+...30....+...40....+...50....+...60....+...70..

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******* This is piece 2. -- It begins at character 73 of table line 1. ********

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Discounted      Reserve

fraction       discount

end           (percent)

   (percent)

73....80....+...90....+.

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******* This is piece 3. -- It begins at character 1 of table line 10. ********

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FARMOWNERS

  AIRCRAFT

AY + 0

AY + 1

AY + 2

AY + 3

AY + 4

AY + 5

AY + 6

AY + 7

AY + 8

AY + 9

AY + 10

AY + 11

AY + 12

1...+...10

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******* This is piece 4. -- It begins at character 11 of table line 10. *******

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MULTIPLE PERIL, HOMEOWNERS MULTIPLE PERIL, COMMERCIAL MULTIPLE PERIL, OCEAN

(ALL PERILS) AND BOILER AND MACHINERY

1985   11473-  20582849    55.7432       55.7432     44.2568  38.9927

         534

1984   14664-  18532075    79.1294       23.3862     20.8706  17.7447

         316

1983   15104-  17470233    86.4591        7.3297     13.5409  11.5143

         598

1982   14477-  15873533    91.2055        4.7464      8.7945  7.4816

         532

1981   12569-  13335391    94.2577        3.0523      5.7423  4.8943

         638

1980   12396-  12821063    96.6880        2.4303      3.3120  2.7517

         429

1979   10566-  10810520    97.7404        1.0524      2.2596  1.8730

         246

1978   83320-  8491257     98.1252         .3847      1.8748  1.6191

          59

1977   72366-  7324158     98.8047         .6795      1.1953  1.0395

          09

1976   65157-  6573477     99.1212         .3165       .8788  .7917

          06

Pre    21159-  21276916      NA            .3165       .5624  5246

1976    251

  NA      NA       NA         NA            .3165       .2459  .2368

  NA      NA       NA         NA            .2459       .0000  .0000

11..+...20....+...30....+...40....+...50....+...60....+...70....+...80....+.

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******* This is piece 5. -- It begins at character 87 of table line 10. *******

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MARINE,

   88.1055

   85.0222

   85.0333

   85.0712

   85.2331

   83.0822

   82.8893

   86.3577

   86.9599

   90.0809

   93.2913

   96.3277

   96.3277

87......+.

[Note:  The following TABLE/FORM is too wide to be displayed on one screen.

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following the tabular data displaying the character positions.]

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******** This is piece 1. -- It begins at character 1 of table line 1. ********

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                                                      Fraction of  Fraction of

                                                      unpaid loss   total loss

                          Net losses   Unpaid losses    paid in        paid in

Years before  Year loss  paid in year  beginning of      year             year

current year  incurred      (000s)      year (000s)    (percent)     (percent)

FIRE

AY + 0          1985       1182445        2142829       55.1815        55.1815

AY + 1          1984        687222        944426        72.7661        32.6127

AY + 2        Pre 1984      196764        462600          NA            6.1029

AY + 3           NA           NA            NA            NA            6.1029

1...+...10....+...20....+...30....+...40....+...50....+...60....+...70....+....

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******* This is piece 2. -- It begins at character 80 of table line 1. ********

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  Fraction of  Discounted       Reserve

loss unpaid,  fraction        discount

     year-end  unpaid, year-     factor

    (percent)  end (percent)  (percent)

      44.8185  41.9316          93.5587

      12.2058  11.3337          92.8552

       6.1029  5.8788           96.3277

        .0000  .0000            96.3277

80..+...90....+....0....+...10....+...2

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assemble a printout of the table.  The information for each piece includes: (1)

a three line message preceding the tabular data showing by line # and

character # the position of the upper left-hand corner of the piece and the

position of the piece within the entire table; and (2) a numeric scale

following the tabular data displaying the character positions.]

*******************************************************************************

******** This is piece 1. -- It begins at character 1 of table line 1. ********

*******************************************************************************

                                                      Fraction of  Fraction of

                                                      unpaid loss   total loss

                          Net losses   Unpaid losses    paid in        paid in

Years before  Year loss  paid in year  beginning of      year             year

current year  incurred      (000s)      year (000s)    (percent)     (percent)

ALLIED LINES

AY + 0          1985        657907        1076282       61.1278        61.1278

AY + 1          1984        297197        388220        76.5538        29.7582

AY + 2        Pre 1984      77676         174175          NA            4.5570

AY + 3           NA           NA            NA            NA            4.5570

1...+...10....+...20....+...30....+...40....+...50....+...60....+...70....+....

*******************************************************************************

******* This is piece 2. -- It begins at character 80 of table line 1. ********

*******************************************************************************

  Fraction of  Discounted       Reserve

loss unpaid,  fraction        discount

     year-end  unpaid, year-     factor

    (percent)  end (percent)  (percent)

      38.8722  36.5181          93.9438

       9.1141  8.4629           92.8552

       4.5570  4.3897           96.3277

        .0000  .0000            96.3277

80..+...90....+....0....+...10....+...2

[Note:  The following TABLE/FORM is too wide to be displayed on one screen.

You must print it for a meaningful review of its contents.  The table has been

divided into multiple pieces with each piece containing information to help you

assemble a printout of the table.  The information for each piece includes: (1)

a three line message preceding the tabular data showing by line # and

character # the position of the upper left-hand corner of the piece and the

position of the piece within the entire table; and (2) a numeric scale

following the tabular data displaying the character positions.]

*******************************************************************************

******** This is piece 1. -- It begins at character 1 of table line 1. ********

*******************************************************************************

                                                      Fraction of  Fraction of

                                                      unpaid loss   total loss

                          Net losses   Unpaid losses    paid in        paid in

Years before  Year loss  paid in year  beginning of      year             year

current year  incurred      (000s)      year (000s)    (percent)     (percent)

INLAND MARINE

AY + 0          1985       1101567        1913177       57.5779        57.5779

AY + 1          1984        562321        731477        76.8747        32.6119

AY + 2        Pre 1984      140515        321225          NA            4.9051

AY + 3           NA           NA            NA            NA            4.9051

1...+...10....+...20....+...30....+...40....+...50....+...60....+...70....+....

*******************************************************************************

******* This is piece 2. -- It begins at character 80 of table line 1. ********

*******************************************************************************

  Fraction of  Discounted       Reserve

loss unpaid,  fraction        discount

     year-end  unpaid, year-     factor

    (percent)  end (percent)  (percent)

      42.4221  39.8668          93.9765

       9.8102  9.1093           92.8552

       4.9051  4.7250           96.3277

        .0000  .0000            96.3277

80..+...90....+....0....+...10....+...2

[Note:  The following TABLE/FORM is too wide to be displayed on one screen.

You must print it for a meaningful review of its contents.  The table has been

divided into multiple pieces with each piece containing information to help you

assemble a printout of the table.  The information for each piece includes: (1)

a three line message preceding the tabular data showing by line # and

character # the position of the upper left-hand corner of the piece and the

position of the piece within the entire table; and (2) a numeric scale

following the tabular data displaying the character positions.]

*******************************************************************************

******** This is piece 1. -- It begins at character 1 of table line 1. ********

*******************************************************************************

                                                      Fraction of  Fraction of

                                                      unpaid loss   total loss

                          Net losses   Unpaid losses    paid in        paid in

Years before  Year loss  paid in year  beginning of      year             year

current year  incurred      (000s)      year (000s)    (percent)     (percent)

MISCELLANEOUS CASUALTY

AY + 0          1985        185443        216664        85.5901        85.5901

AY + 1          1984        12581          14861        84.6578        12.1991

AY + 2        Pre 1984       1729          4100           NA            1.1054

AY + 3           NA           NA            NA            NA            1.1054

1...+...10....+...20....+...30....+...40....+...50....+...60....+...70....+....

*******************************************************************************

******* This is piece 2. -- It begins at character 80 of table line 1. ********

*******************************************************************************

  Fraction of  Discounted       Reserve

loss unpaid,  fraction        discount

     year-end  unpaid, year-     factor

    (percent)  end (percent)  (percent)

      14.4099  13.6559          94.7678

       2.2108  2.0528           92.8552

       1.1054  1.0648           96.3277

        .0000  .0000            96.3277

80..+...90....+....0....+...10....+...2

[Note:  The following TABLE/FORM is too wide to be displayed on one screen.

You must print it for a meaningful review of its contents.  The table has been

divided into multiple pieces with each piece containing information to help you

assemble a printout of the table.  The information for each piece includes: (1)

a three line message preceding the tabular data showing by line # and

character # the position of the upper left-hand corner of the piece and the

position of the piece within the entire table; and (2) a numeric scale

following the tabular data displaying the character positions.]

*******************************************************************************

******** This is piece 1. -- It begins at character 1 of table line 1. ********

*******************************************************************************

                                                      Fraction of  Fraction of

                                                      unpaid loss   total loss

                          Net losses   Unpaid losses    paid in        paid in

Years before  Year loss  paid in year  beginning of      year             year

current year  incurred      (000s)      year (000s)    (percent)     (percent)

EARTHQUAKE

AY + 0          1985         3852          13974        27.5655        27.5655

AY + 1          1984         1654          3010         54.9502        39.8029

AY + 2        Pre 1984       722           1757           NA           16.3158

AY + 3           NA           NA            NA            NA             .5496

1...+...10....+...20....+...30....+...40....+...50....+...60....+...70....+....

*******************************************************************************

******* This is piece 2. -- It begins at character 80 of table line 1. ********

*******************************************************************************

  Fraction of  Discounted       Reserve

loss unpaid,  fraction        discount

     year-end  unpaid, year-     factor

    (percent)  end (percent)  (percent)

      72.4345  66.4568          91.7474

      32.6316  30.3002          92.8552

      16.3158  15.7166          96.3277

        .0000  .0000            96.3277

80..+...90....+....0....+...10....+...2

[Note:  The following TABLE/FORM is too wide to be displayed on one screen.

You must print it for a meaningful review of its contents.  The table has been

divided into multiple pieces with each piece containing information to help you

assemble a printout of the table.  The information for each piece includes: (1)

a three line message preceding the tabular data showing by line # and

character # the position of the upper left-hand corner of the piece and the

position of the piece within the entire table; and (2) a numeric scale

following the tabular data displaying the character positions.]

*******************************************************************************

******** This is piece 1. -- It begins at character 1 of table line 1. ********

*******************************************************************************

                                                      Fraction of  Fraction of

                                                      unpaid loss   total loss

                          Net losses   Unpaid losses    paid in        paid in

Years before  Year loss  paid in year  beginning of      year             year

current year  incurred      (000s)      year (000s)    (percent)     (percent)

AUTO PHYSICAL DAMAGE

AY + 0          1985       13876758      16695051       83.1190        83.1190

AY + 1          1984       1743502        1864945       93.4881        15.7817

AY + 2        Pre 1984     -128871        -44115          NA             .5496

AY + 3           NA           NA            NA            NA             .5496

1...+...10....+...20....+...30....+...40....+...50....+...60....+...70....+....

*******************************************************************************

******* This is piece 2. -- It begins at character 80 of table line 1. ********

*******************************************************************************

  Fraction of  Discounted       Reserve

loss unpaid,  fraction        discount

     year-end  unpaid, year-     factor

    (percent)  end (percent)  (percent)

      16.8810  16.1493          95.6656

       1.0993  1.0207           92.8552

        .5496  .5295            96.3277

        .0000  .0000            96.3277

80..+...90....+....0....+...10....+...2

[Note:  The following TABLE/FORM is too wide to be displayed on one screen.

You must print it for a meaningful review of its contents.  The table has been

divided into multiple pieces with each piece containing information to help you

assemble a printout of the table.  The information for each piece includes: (1)

a three line message preceding the tabular data showing by line # and

character # the position of the upper left-hand corner of the piece and the

position of the piece within the entire table; and (2) a numeric scale

following the tabular data displaying the character positions.]

*******************************************************************************

******** This is piece 1. -- It begins at character 1 of table line 1. ********

*******************************************************************************

                                                      Fraction of  Fraction of

                                                      unpaid loss   total loss

                          Net losses   Unpaid losses    paid in        paid in

Years before  Year loss  paid in year  beginning of      year             year

current year  incurred      (000s)      year (000s)    (percent)     (percent)

FIDELITY

AY + 0          1985        63993         281102        22.7650        22.7650

AY + 1          1984        108652        212771        51.0652        39.4402

AY + 2        Pre 1984      76630         196869          NA           18.8974

AY + 3           NA           NA            NA            NA           18.8974

1...+...10....+...20....+...30....+...40....+...50....+...60....+...70....+....

*******************************************************************************

******* This is piece 2. -- It begins at character 80 of table line 1. ********

*******************************************************************************

  Fraction of  Discounted       Reserve

loss unpaid,  fraction        discount

     year-end  unpaid, year-     factor

    (percent)  end (percent)  (percent)

      77.2340  70.5560          91.3524

      37.7947  35.0944          92.8552

      18.8974  18.2034          96.3277

        .0000  .0000            96.3277

80..+...90....+....0....+...10....+...2

[Note:  The following TABLE/FORM is too wide to be displayed on one screen.

You must print it for a meaningful review of its contents.  The table has been

divided into multiple pieces with each piece containing information to help you

assemble a printout of the table.  The information for each piece includes: (1)

a three line message preceding the tabular data showing by line # and

character # the position of the upper left-hand corner of the piece and the

position of the piece within the entire table; and (2) a numeric scale

following the tabular data displaying the character positions.]

*******************************************************************************

******** This is piece 1. -- It begins at character 1 of table line 1. ********

*******************************************************************************

                                                      Fraction of  Fraction of

                                                      unpaid loss   total loss

                          Net losses   Unpaid losses    paid in        paid in

Years before  Year loss  paid in year  beginning of      year             year

current year  incurred      (000s)      year (000s)    (percent)     (percent)

SURETY

AY + 0          1985        322557        869869        37.0811        37.0811

AY + 1          1984        221719        418289        53.0062        33.3509

AY + 2        Pre 1984      29380         252418          NA           14.7840

AY + 3           NA           NA            NA            NA           14.7840

1...+...10....+...20....+...30....+...40....+...50....+...60....+...70....+....

*******************************************************************************

******* This is piece 2. -- It begins at character 80 of table line 1. ********

*******************************************************************************

  Fraction of  Discounted       Reserve

loss unpaid,  fraction        discount

     year-end  unpaid, year-     factor

    (percent)  end (percent)  (percent)

      62.9189  57.6021          91.5497

      29.5680  27.4554          92.8552

      14.7840  14.2411          96.3277

        .0000  .0000            96.3277

80..+...90....+....0....+...10....+...2

[Note:  The following TABLE/FORM is too wide to be displayed on one screen.

You must print it for a meaningful review of its contents.  The table has been

divided into multiple pieces with each piece containing information to help you

assemble a printout of the table.  The information for each piece includes: (1)

a three line message preceding the tabular data showing by line # and

character # the position of the upper left-hand corner of the piece and the

position of the piece within the entire table; and (2) a numeric scale

following the tabular data displaying the character positions.]

*******************************************************************************

******** This is piece 1. -- It begins at character 1 of table line 1. ********

*******************************************************************************

                                                      Fraction of  Fraction of

                                                      unpaid loss   total loss

                          Net losses   Unpaid losses    paid in        paid in

Years before  Year loss  paid in year  beginning of      year             year

current year  incurred      (000s)      year (000s)    (percent)     (percent)

GLASS

AY + 0          1985         5330          8021         66.4506        66.4506

AY + 1          1984         1482          1703         87.0229        29.1957

AY + 2        Pre 1984       145            518           NA            2.1769

AY + 3           NA           NA            NA            NA            2.1769

1...+...10....+...20....+...30....+...40....+...50....+...60....+...70....+....

*******************************************************************************

******* This is piece 2. -- It begins at character 80 of table line 1. ********

*******************************************************************************

  Fraction of  Discounted       Reserve

loss unpaid,  fraction        discount

     year-end  unpaid, year-     factor

    (percent)  end (percent)  (percent)

      33.5494  31.8747          95.0083

       4.3537  4.0427           92.8552

       2.1769  2.0969           96.3277

        .0000  .0000            96.3277

80..+...90....+....0....+...10....+...2

[Note:  The following TABLE/FORM is too wide to be displayed on one screen.

You must print it for a meaningful review of its contents.  The table has been

divided into multiple pieces with each piece containing information to help you

assemble a printout of the table.  The information for each piece includes: (1)

a three line message preceding the tabular data showing by line # and

character # the position of the upper left-hand corner of the piece and the

position of the piece within the entire table; and (2) a numeric scale

following the tabular data displaying the character positions.]

*******************************************************************************

******** This is piece 1. -- It begins at character 1 of table line 1. ********

*******************************************************************************

                                                      Fraction of  Fraction of

                                                      unpaid loss   total loss

                          Net losses   Unpaid losses    paid in        paid in

Years before  Year loss  paid in year  beginning of      year             year

current year  incurred      (000s)      year (000s)    (percent)     (percent)

BURGLARY AND THEFT

AY + 0          1985        16947          35142        48.2243        48.2243

AY + 1          1984        10304          13001        79.2554        41.0340

AY + 2        Pre 1984       3182          8093           NA            5.3703

AY + 3           NA           NA            NA            NA            5.3703

1...+...10....+...20....+...30....+...40....+...50....+...60....+...70....+....

*******************************************************************************

******* This is piece 2. -- It begins at character 80 of table line 1. ********

*******************************************************************************

  Fraction of  Discounted       Reserve

loss unpaid,  fraction        discount

     year-end  unpaid, year-     factor

    (percent)  end (percent)  (percent)

      51.7757  48.7823          94.2185

      10.7406  9.9732           92.8552

       5.3703  5.1731           96.3277

        .0000  .0000            96.3277

80..+...90....+....0....+...10....+...2

[Note:  The following TABLE/FORM is too wide to be displayed on one screen.

You must print it for a meaningful review of its contents.  The table has been

divided into multiple pieces with each piece containing information to help you

assemble a printout of the table.  The information for each piece includes: (1)

a three line message preceding the tabular data showing by line # and

character # the position of the upper left-hand corner of the piece and the

position of the piece within the entire table; and (2) a numeric scale

following the tabular data displaying the character positions.]

*******************************************************************************

******** This is piece 1. -- It begins at character 1 of table line 1. ********

*******************************************************************************

                                                      Fraction of  Fraction of

                                                      unpaid loss   total loss

                          Net losses   Unpaid losses    paid in        paid in

Years before  Year loss  paid in year  beginning of      year             year

current year  incurred      (000s)      year (000s)    (percent)     (percent)

CREDIT

AY + 0          1985        54286         218630        24.8301        24.8301

AY + 1          1984        52253         126369        41.3495        31.0824

AY + 2        Pre 1984       9995          43661          NA           22.0438

AY + 3           NA           NA            NA            NA           22.0438

1...+...10....+...20....+...30....+...40....+...50....+...60....+...70....+....

*******************************************************************************

******* This is piece 2. -- It begins at character 80 of table line 1. ********

*******************************************************************************

  Fraction of  Discounted       Reserve

loss unpaid,  fraction        discount

     year-end  unpaid, year-     factor

    (percent)  end (percent)  (percent)

      75.1699  67.9270          90.3646

      44.0875  40.9375          96.3277

      22.0438  21.2342          96.3277

        .0000  .0000            96.3277

80..+...90....+....0....+...10....+...2

[Note:  The following TABLE/FORM is too wide to be displayed on one screen.

You must print it for a meaningful review of its contents.  The table has been

divided into multiple pieces with each piece containing information to help you

assemble a printout of the table.  The information for each piece includes: (1)

a three line message preceding the tabular data showing by line # and

character # the position of the upper left-hand corner of the piece and the

position of the piece within the entire table; and (2) a numeric scale

following the tabular data displaying the character positions.]

*******************************************************************************

******** This is piece 1. -- It begins at character 1 of table line 1. ********

*******************************************************************************

                                                      Fraction of  Fraction of

                                                      unpaid loss   total loss

                          Net losses   Unpaid losses    paid in        paid in

Years before  Year loss  paid in year  beginning of      year             year

current year  incurred      (000s)      year (000s)    (percent)     (percent)

CREDIT ACCIDENT AND HEALTH (group and individual)

AY + 0          1985        50544          93229        54.2149        54.2149

AY + 1          1984        26637          42512        62.6576        28.6879

AY + 2        Pre 1984       8295          18171          NA            8.5486

AY + 3           NA           NA            NA            NA            8.5486

1...+...10....+...20....+...30....+...40....+...50....+...60....+...70....+....

*******************************************************************************

******* This is piece 2. -- It begins at character 80 of table line 1. ********

*******************************************************************************

  Fraction of  Discounted       Reserve

loss unpaid,  fraction        discount

     year-end  unpaid, year-     factor

    (percent)  end (percent)  (percent)

      45.7851  42.3654          92.5310

      17.0973  15.8757          92.8552

       8.5486  8.2347           96.3277

        .0000  .0000            96.3277

80..+...90....+....0....+...10....+...2

Rev. Rul. 88-63, 1988-2 C.B. 130, 1988-31 I.R.B. 5.