CAS Exam 5 Spring 2014, Question 19
Study guide: Exam 5
Given the following information as of December 31, 2013:
| Calendar Year | Earned Premium ($000) | On-Level Earned Premium ($000) |
|---|---|---|
| 2010 | 5,044 | 5,000 |
| 2011 | 6,278 | 6,000 |
| 2012 | 6,895 | 6,500 |
| 2013 | 8,000 | 8,000 |
Reported Claims ($000)
| Accident Year | 12 Months | 24 Months | 36 Months | 48 Months |
|---|---|---|---|---|
| 2010 | 665 | 1,426 | 2,616 | 3,118 |
| 2011 | 915 | 1,828 | 3,140 | |
| 2012 | 890 | 1,840 | ||
| 2013 | 904 |
- Annual claims trend = -2%.
- Assume no development beyond 48 months.
Estimate ultimate claims for accident year 2013 using the expected claims technique.
Part a (1.75 points)
Answer this question and see the worked solution