Which of the following best characterizes incurred but not reported (IBNR) claims?

Incurred but not reported (IBNR) claims refer to the estimated amounts for claims that have occurred but have not yet been reported to the insurer. This concept is crucial in the insurance industry, particularly for property and casualty insurers, as it allows them to anticipate future liabilities based on past trends and current data. Actuaries use historical data to estimate the value of these claims, ensuring that insurers maintain adequate reserves to cover potential future payouts. By accounting for IBNR claims, an insurance company can better manage its financial stability and ensure it remains solvent and able to meet its obligations to policyholders.

The other options miss the mark in defining IBNR claims. Known claims that are settled, claims with no reserves established, and claims that have been reported do not align with the key characteristic of IBNR, which specifically involves claims that have occurred but are still pending acknowledgment or processing within the insurer's books.