CAS Exam 5 Spring 2015, Question 9
Study guide: Exam 5
Given the following information:
| Expense Type | 2014 Expense Amount |
|---|---|
| Other Acquisition | $4,000 |
| General | $17,000 |
| Commission and Brokerage | $23,000 |
| Taxes, License, and Fees | $5,000 |
- 2014 written premium = $200,000.
- 2014 earned premium = $170,000.
- Statewide average loss cost per exposure = $250.
- Profit and contingencies provision = 3%.
- General expenses are incurred throughout the policy term.
- All other expenses are incurred at the beginning of the policy.
Calculate the indicated average rate.
Part a (1.25 points)
Answer this question and see the worked solution