CAS Exam 6C Spring 2017, Question 27
Study guide: Exam 6C
Part a (0.75 points)
Briefly describe the three circumstances under which a subsequent event needs to be accounted for.
Part b (1.5 points)
The Appointed Actuary of a property and casualty insurance company is valuing policy liabilities as at December 31, 2016. The report date is February 19, 2017. For each of the following scenarios, briefly discuss the actions that the Appointed Actuary should take.
- i. On March 7, 2017, it was discovered that due to a system issue, all automobile physical damage claims reported in December were reported at the opening case reserve instead of at their actual claim amounts.
- ii. A major winter storm occurred on February 12, 2017.
- iii. Automobile insurance reforms were announced on February 26, 2017, where the threshold on minor injury claims was lowered from $5,000 to $2,500 in a province. The insurance company writes 50% of its automobile business in that province.
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