CAS Exam 5 Spring 2014, Question 23
Study guide: Exam 5
Given the following information as of December 31, 2013:
| Accident Year | Selected Ultimate Claims | Reported Claims | Paid Claims |
|---|---|---|---|
| 2013 | $1,150 | $500 | $250 |
| Age in Months | Selected Cumulative Percent Reported | Selected Cumulative Percent Paid |
|---|---|---|
| 36 | 100% | 100% |
| 24 | 80% | 55% |
| 12 | A | 20% |
- The expected reported claims for accident year 2013 during calendar year 2014 are $433.
- The expected paid claims for accident year 2013 during calendar year 2014 are $394.
Part a (0.75 points)
Calculate "A", the selected cumulative percent reported at 12 months.
Part b (1 point)
Assume that the actual paid and reported claims for accident year 2013 in calendar year 2014 are equal to the expected paid and reported claims for accident year 2013 in calendar year 2014.
Calculate the unpaid claim estimate for accident year 2013 as of December 31, 2014 using the case outstanding development technique.
Answer this question and see the worked solution