CAS Exam 7 Spring 2014, Question 2

Study guide: Exam 7

Given the following output from a company's reserving software:

• C_{i1}: Loss evaluated at 12 months for accident year i ($000)
• C_{i2}: Loss evaluated at 24 months for accident year i ($000)

Based on the two charts above, explain whether the chain-ladder method is appropriate for estimating ultimate loss.

Part a (1 point)

Answer this question and see the worked solution

Concepts tested

• Chain Ladder Method
• Residual Plot
• Mack Chain Ladder Model
• Chain Ladder Assumptions

More questions from this set

• CAS Exam 7 Spring 2014, Question 1
• CAS Exam 7 Spring 2014, Question 3