SOA Exam FAM Sample Question 98
Study guide: Exam FAM
An insurance company sells one-year policies that have uniformly distributed effective dates.
The following rate changes have occurred:
| Date | Rate Change |
|---|---|
| June 1, CY1 | +10% |
| August 1, CY2 | r |
Rates are currently at the level set on August 1, CY2.
The earned premium at current rates for CY2 is 1.03 times the CY2 earned premium.
Calculate r.
- A) 1.7%
- B) 2.4%
- C) 3.3%
- D) 5.3%
- E) 7.5%
Answer this question and see the worked solution