Exam MAS-II Practice Question 1
Study guide: Exam MAS-II
An actuary is updating the claim frequency for one territory using classical (limited fluctuation) credibility. You are given:
- Earned exposures in the territory: 25,000 car-years
- Reported claims in the territory: 480
- Statewide frequency, used as the complement of credibility: 0.0240 claims per car-year
- Standard for full credibility: 1,082 claims
- Partial credibility is assigned by the square-root rule
Calculate the credibility-weighted claim frequency for the territory.
- A) 0.0192
- B) 0.0208
- C) 0.0219
- D) 0.0224
- E) 0.0240
Answer this question and see the worked solution