CAS Exam 5 Spring 2016, Question 15
Study guide: Exam 5
Given the following information:
Personal Auto: Cumulative Reported Claims ($000) as of (months):
| Accident Year | 12 | 24 | 36 |
|---|---|---|---|
| 2013 | 10,000 | 12,500 | 13,750 |
| 2014 | 10,500 | 13,120 | |
| 2015 | 11,000 |
Commercial Auto: Cumulative Reported Claims ($000) as of (months):
| Accident Year | 12 | 24 | 36 |
|---|---|---|---|
| 2013 | 2,000 | 4,000 | 5,000 |
| 2014 | 4,000 | 8,000 | |
| 2015 | 5,000 |
- The insurer began operating January 1, 2013.
Part a (0.5 points)
Calculate personal auto reported claims for each of the calendar years 2013, 2014, and 2015.
Part b (0.25 points)
Briefly discuss the appropriateness of using calendar year aggregation in estimating unpaid claims.
Part c (0.25 points)
Briefly discuss the appropriateness of using accident year aggregation in estimating unpaid claims.
Part d (0.5 points)
Evaluate the appropriateness of combining the two lines of business above when estimating unpaid claims for this insurer.
Answer this question and see the worked solution
Concepts tested
- Calendar Year
- Accident Year
- Unpaid Claims
- Mix of Business
- Reserving Data Organization
- Data Segmentation