CAS Exam 6C Fall 2013, Question 7
Study guide: Exam 6C
A company has submitted a rate filing for a high-risk auto product in the province of New Brunswick. The company's return on equity (ROE) target for this line is 15%. The regulator is challenging the 15% ROE as excessive and suggests that a target of 10% is more appropriate.
Provide two arguments defending a 15% ROE target.
Part a (1 point)
Answer this question and see the worked solution