CAS Exam 5 Fall 2019, Question 1
Study guide: Exam 5
Given the following quarterly exposure information:
| Calendar Year and Quarter | Written Exposures | Earned Exposures |
|---|---|---|
| 2017 Q1 | 100 | 5.00 |
| 2017 Q2 | 450 | 247.50 |
| 2017 Q3 | 400 | 427.50 |
| 2017 Q4 | 100 | 52.50 |
| 2018 Q1 | 125 | 53.75 |
| 2018 Q2 | 550 | 528.75 |
| 2018 Q3 | 475 | 562.50 |
| 2018 Q4 | 30 | 59.00 |
- The company started writing business on January 1, 2017.
- The company stops writing business on December 31, 2018.
- The quarterly earnings pattern was set by analyzing historical experience across the industry and is not uniform.
- All policies are annual.
- All policies are written on the first day of the quarter.
- There are no policy cancellations and no mid-term adjustments.
Part a (0.5 points)
Calculate the 2017 policy year earned exposures as of March 31, 2018.
Part b (0.25 points)
Calculate the in-force exposures as of May 31, 2018.
Part c (0.5 points)
Calculate the calendar year 2018 unearned exposures.
Part d (0.5 points)
Calculate the calendar year 2019 quarter 1 earned exposures.
Answer this question and see the worked solution