3. You are given the following information about the loss payments of an insurance com- pany:...

 

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3. You are given the following information about the loss payments of an insurance com- pany: Accident Year AY1 AY2 AY3 AY4 AY5 Cumulative Loss Payments in Development Year 2 3 0 1 4 2,000 3,100 3,800 4,200 4,500 2,200 3,200 4,000 4,650 2,500 3,600 4,500 2,600 3,600 2,700 1 All losses are fully settled within four years. Compute the total lost costs using the chain-ladder method with the loss age-to-age development factors estimated using the arithmetic average. 3. You are given the following information about the loss payments of an insurance com- pany: Accident Year AY1 AY2 AY3 AY4 AY5 Cumulative Loss Payments in Development Year 2 3 0 1 4 2,000 3,100 3,800 4,200 4,500 2,200 3,200 4,000 4,650 2,500 3,600 4,500 2,600 3,600 2,700 1 All losses are fully settled within four years. Compute the total lost costs using the chain-ladder method with the loss age-to-age development factors estimated using the arithmetic average.

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Total lost costs AY1 AY2 AY3 AY4 AY5 2000 2200 2500 2600 2700 11500 Chainlad... View the full answer