CAS Exam 6C Fall 2016, Question 17
Study guide: Exam 6C
The following information for a property and casualty insurance company is available:
| Item | Amount |
|---|---|
| Eastern Canada PML 500 | $100M |
| Eastern Canada PML 420 | $70M |
| Western Canada PML 500 | $230M |
| Western Canada PML 420 | $150M |
- Financial resources available to support insurer's earthquake risk: $100M.
- There is no reinsurance purchased by the company.
- The company is phasing in the use of PML 500 until 2022.
Part a (1 point)
Calculate the Earthquake Reserves Component for reporting year 2016.
Part b (0.75 points)
Identify three sound earthquake modelling practices.
Part c (0.75 points)
Identify three non-modelled risks that may impact PML.
Answer this question and see the worked solution