In which industry is the 'Bornhuetter-Ferguson method' utilised?

The Bornhuetter-Ferguson method is a prominent loss reserving technique.

The Bornhuetter-Ferguson method was introduced in the 1972 paper "The Actuary and IBNR," co-authored by Ron Bornhuetter and Ron Ferguson.

Like other loss reserving techniques, the Bornhuetter-Ferguson method aims to estimate incurred but not reported insurance claim amounts. It is primarily used in the property and casualty and health insurance fields.

Generally considered a blend of the chain-ladder and expected claims loss reserving methods, the Bornhuetter-Ferguson method uses both reported or paid losses as well as an ‘a priori’ expected loss ratio to arrive at an ultimate loss estimate. Simply, reported (or paid) losses are added to a priori expected losses multiplied by an estimated percent unreported. The estimated percent unreported (or unpaid) is established by observing historical claims experience.

The Bornhuetter-Ferguson method can be used with either reported or paid losses.