CAS Exam 5 Spring 2016, Question 17
Study guide: Exam 5
Given the following as of December 31, 2015:
| Accident Year | Reported Claims ($000) | Paid Claims ($000) | Reported Claim Count Development Factor to Ultimate |
|---|---|---|---|
| 2013 | 15,000 | 15,000 | 1.0 |
| 2014 | 12,000 | 10,000 | 1.1 |
| 2015 | 7,000 | 3,000 | 2.0 |
Selected Ratios:
| Age (months) | Case Outstanding to Previous Case Outstanding | Incremental Paid Claims to Previous Case Outstanding |
|---|---|---|
| 48 | 0 | 0 |
| 36 | 0 | 3.5 |
| 24 | 0.5 | 2.0 |
Part a (1.5 points)
Estimate the accident year 2015 unpaid claims using the case outstanding development technique.
Part b (0.5 points)
Assess whether the case outstanding development technique is appropriate for accident year 2015.
Answer this question and see the worked solution