CAS Exam 6C Fall 2014, Question 16
Study guide: Exam 6C
The following information is taken from page 80.10 of a property and casualty insurance company's P&C-1 as at December 31, 2013. All amounts are in thousands dollars ($000s).
| Deferred Commissions at beginning of year | Deferred Commissions end of year | Direct (commissions in respect of premiums written) | Reinsurance Assumed (commissions in respect of premiums written) | Reinsurance Ceded (commissions in respect of premiums written) | Net (commissions in respect of premiums written) | |
|---|---|---|---|---|---|---|
| Auto | 30,500 | 32,100 | 65,200 | 0 | 2,800 | 62,400 |
| Property | 13,400 | 14,400 | ? | 0 | 0 | ? |
| Total | 43,900 | 46,500 | ? | 0 | 2,800 | ? |
| Unearned Commissions at beginning of year | Unearned Commissions end of year | Net Commissions attributable to the Period | |
|---|---|---|---|
| Auto | 2,600 | 2,900 | ? |
| Property | 0 | 0 | 30,000 |
| Total | 2,600 | 2,900 | ? |
Other financial information from page 80.10:
- Gross contingent commissions = $11,000.
- Ceded contingent commissions = $0.
- The company had no gross or ceded other non-deferrable commissions.
Calculate total net commissions as it appears on page 80.10.
Part a (2.5 points)
No current syllabus covers this question; it is kept for the record.
Answer this question and see the worked solution
Concepts tested
- Deferred Policy Acquisition Expenses
- Canadian Annual Return
- Insurance Acquisition Cash Flows
- Financial Statements