SOA Exam FAM Sample Question 70
Study guide: Exam FAM
You are given:
i) Policies are written uniformly throughout the year.
ii) Policies have a term of 6 months.
iii) The following rate changes have occurred:
| Date | Amount |
|---|---|
| October 1, CY1 | +7% |
| July 1, CY2 | +10% |
| September 1, CY3 | –6% |
Rates are currently at the September 1, CY3 level.
Calculate the on-level factor needed to adjust CY2 earned premiums to the current rate level.
- A) 0.97
- B) 0.98
- C) 0.99
- D) 1.00
- E) 1.01
Answer this question and see the worked solution