CAS Exam 6C Spring 2014, Question 9
Study guide: Exam 6C
In a given jurisdiction, auto insurance pricing is regulated. The government recently mandated a rate freeze on a particular class of risks, which made them rate inadequate. There is no "take-all-comers" rule in this particular jurisdiction.
Part a (0.25 points)
Describe how the rate freeze will impact the availability of insurance for this class of risks.
Part b (1 point)
Propose and fully describe a solution for this jurisdiction to address the issues in part a. above without imposing a "take-all-comers" rule.
Answer this question and see the worked solution