CAS Exam 6C Spring 2014, Question 18
Study guide: Exam 6C
The following information is available from the December 31, 2012, Appointed Actuary's Report of an insurance company.
Incremental Paid Losses and ALAE
| Accident Year | 12 month ($000s) | 24 month ($000s) | 36 month ($000s) |
|---|---|---|---|
| 2010 | $40,000 | $20,000 | $10,000 |
| 2011 | $45,000 | $15,000 | |
| 2012 | $35,000 |
Discounted Outstanding Losses and ALAE
| Accident Year | 12 month ($000s) | 24 month ($000s) | 36 month ($000s) |
|---|---|---|---|
| 2010 | $48,000 | $30,000 | $18,000 |
| 2011 | $47,000 | $28,000 | |
| 2012 | $50,000 |
Annual Yield
| CY 2010 | CY 2011 | CY 2012 | |
|---|---|---|---|
| Annual Yield | 2.75% | 3.0% | 2.5% |
Calculate the discounted excess or deficiency ratio for accident year 2010 as at December 31, 2012.
Part a (1.75 points)
Answer this question and see the worked solution