CAS Exam 5 Fall 2019, Question 18
Study guide: Exam 5
Given the following data evaluated as of December 31, 2018:
| Accident Year | Cumulative Paid Claims ($000) as of 12 months | 24 | 36 | 48 |
|---|---|---|---|---|
| 2015 | 1,200 | 2,325 | 2,900 | 3,100 |
| 2016 | 1,800 | 3,300 | 4,100 | |
| 2017 | 1,500 | 2,800 | ||
| 2018 | 1,700 |
| Accident Year | Case Outstanding ($000) as of 12 months | 24 | 36 | 48 |
|---|---|---|---|---|
| 2015 | 1,500 | 800 | 400 | 160 |
| 2016 | 2,000 | 1,150 | 575 | |
| 2017 | 1,750 | 975 | ||
| 2018 | 2,200 |
| Value | Item |
|---|---|
| 1.15 | 48-Ult paid claim to prior case outstanding development factor |
- There is no paid or reported development beyond 60 months.
Part a (1.5 points)
Estimate unpaid claims for accident year 2018 as of December 31, 2018 using a case outstanding development technique.
Part b (0.25 points)
Briefly describe a scenario where it would be appropriate to use the case outstanding development technique.
Answer this question and see the worked solution