CAS Exam 5 Fall 2017, Question 16
Study guide: Exam 5
An insurer has the following book of insurance policies and claim experience as of December 31, 2016:
| Policy Number | Policy Effective Date | Policy Term (in Months) | Gross Written Premium |
|---|---|---|---|
| 1 | January 1, 2015 | 12 | 12,000 |
| 2 | June 1, 2015 | 6 | 7,000 |
| 3 | August 1, 2015 | 12 | 10,000 |
| 4 | February 1, 2016 | 12 | 15,000 |
| 5 | May 1, 2016 | 6 | 8,000 |
| Claim Number | Accident Date | Claim Report Date | Gross Paid Claims | Gross Case Reserves | Reinsurance Recoveries |
|---|---|---|---|---|---|
| 1 | September 1, 2015 | October 1, 2015 | 2,000 | 0 | 0 |
| 2 | November 1, 2015 | January 1, 2016 | 3,000 | 1,000 | 500 |
| 3 | March 1, 2016 | March 1, 2016 | 1,000 | 2,000 | 0 |
| 4 | July 1, 2016 | September 1, 2016 | 4,000 | 0 | 1,000 |
Part a (0.5 points)
Calculate the calendar year 2016 gross earned premium.
Part b (0.25 points)
Calculate the gross unearned premium as of December 31, 2016.
Part c (0.5 points)
Calculate the reported claims net of reinsurance recoveries for accident year 2016 as of December 31, 2016.
Answer this question and see the worked solution