Which department is responsible for setting individual case reserves?

The claims department is responsible for setting individual case reserves because it directly handles the evaluation and management of claims made by policyholders. Case reserves are estimates of the potential future payouts for specific claims, and setting these reserves is essential for ensuring that the insurer has sufficient funds available to cover anticipated liabilities.

Claims adjusters and managers within the claims department assess the details of each claim—such as the nature of the loss, coverage terms, and legal considerations—to determine how much money should be set aside. Their expertise allows them to analyze the unique aspects of each case, including the claimant's situation and any applicable policy limits. This plays a critical role in ensuring that the insurance company remains financially solvent and compliant with regulatory requirements regarding reserve requirements.

In contrast, other departments like underwriting focus on the overall risk assessment and pricing of insurance policies, finance deals with the broader financial management of the company, and risk management analyzes the overall risk exposure rather than individual claims.