ABC insurer issues homeowner insurance policies to cover residential buildings. The historical data on covered perils (like fire accidents) and the associated losses are quite sufficient, and historical loss ratios can be easily estimated. Moreover, there are more than 100,000 residential buildings covered under by ABC insurer, and the average claim payment is relatively small. Near the end of the accounting period, several fire accidents damaged covered buildings and the claims were filed. However, these claims cannot be paid before the end of this accounting period, and ABC insurer is expected to pay these claims in the next year. Based on the above-mentioned description, what method(s) would you recommend in the estimation of loss reserves? Is ABC insurer's profitability in this accounting period affected by the scenario in the second paragraph?