CAS Exam 5 Spring 2014, Question 20
Study guide: Exam 5
Given the following data as of December 31, 2013:
Incremental Paid Claims Gross of Salvage and Subrogation ($000)
| Accident Year | 0-12 months | 12-24 months | 24-36 months |
|---|---|---|---|
| 2011 | 4,000 | 1,000 | 500 |
| 2012 | 4,500 | 1,125 | |
| 2013 | 5,000 |
Incremental Received Salvage and Subrogation ($000)
| Accident Year | 0-12 months | 12-24 months | 24-36 months |
|---|---|---|---|
| 2011 | 800 | 950 | 450 |
| 2012 | 900 | 1,609 | |
| 2013 | 1,250 |
- Assume no development beyond 36 months of age for either paid claims or salvage and subrogation.
Estimate the ultimate salvage and subrogation for accident year 2013 using a ratio approach.
Part a (2.25 points)
Answer this question and see the worked solution