You are given the following information: All policies have 12 months terms. The effective date is...
Fantastic news! We've located the answer you've been seeking!
Question:
Transcribed Image Text:
You are given the following information: All policies have 12 months terms. The effective date is proposed to be 01/10/2019 and it will be in effect for 12 months. There are premium rate changes during 01/07/2017 with a decrement of 4% and during 01/01/2019 with an increment of 5%. (b) (c) • • (d) • Premium trending factor is set to be 1%. Calendar/Accident Year 2017 2018 2015 2016 2017 Earned Premium 1.40 1.40 1.40 1.40 1.30 1.30 1.30 $600,000 $650,000 Given the Case Incurred Loss and ALAE Link Ratios as table below: Accident 1224 2436 3648 Year months months months 2011 2012 2013 2014 1.07 1.07 1.07 1.07 1.15 1.15 Case Incurred Losses and ALAE 1.05 1.05 1.05 1.05 1.05 $250,000 $350,000 4860 months 1.03 1.03 1.03 1.03 • Given tail development factor beyond 72 months is 1.01. • Selected annual frequency trend is 2% and selected annual severity trend is 5%. • ULAE is set to be 4% of ultimate loss and ALAE consistently. • Projected fixed expense provision is 10% and variable expense provision is 20%. • Profit and contingencies provision is set to be 3% of premium. (a) Calculate the 2017 and 2018 projected calendar year earned premium at current rate level. 6072 months 1.02 1.02 1.02 Calculate the 2017 and 2018 projected calendar accident year losses and LAE. Select 12month and 24month age to ultimate factors. Briefly explain your selection. Calculate the indicated rate change, giving 40% weight to calendar accident year 2017 and 60% weight to calendar accident year 2018.
Expert Answer:
Answer rating: 100% (QA)
a To calculate the projected calendar year earned premium at the current rate level for 2017 and 2018 we need to consider the premium rate changes and View the full answer
Related Book For
Smith and Roberson Business Law
ISBN: 9780538473637
15th Edition
Authors: Richard A. Mann, Barry S. Roberts
Posted Date:
Students also viewed these finance questions

You are given the following information in relation to Olivet Ltd. Required: You are required to comment on the financial position of Olivet Let as at 20X5. Calculate any ratios you feel necessary....

You are given the following information concerning a stock and the market: Calculate the average return and standard deviation for the market and the stock. Next, calculate the correlation between...

Mickey Limited is a manufacturing business that uses a standard costing system. The companys flexed budget for April 20X9 is: Sales 173,340 Costs Direct materials (22,500) Direct labour (37,684)...

Donovan, Inc.s inventory records for a particular development program show the following at August 31: At August 31, nine of these programs are on hand. Journalize the following for Donovan: 1. Total...

Name each of the following unbranched alkanes: (a) C 9 H 20 ; (b) C 6 H 14 ; (c) C 11 H 24 ; (d) C 12 H 26 .

Given an 8bit ALU with outputs F 7 through F 0 and available carries C 8 and C 7 , show the logic circuit for generating the signals for the four status bits N (sign), Z (zero), V (overflow), and C...

A long cylindrical heater element of diameter D = 10 mm, temperature T 1 = 1500 K, and emissivity ? 1 = 1 is used in a furnace. The bottom area A 2 is a diffuse gray surface with ? 2 = 0.6 and is...

You have to read "Letter from Birmingham City Jail" by Martin Luther King, Jr. Read the study questions to help you understand King's essay, but you are not required to turn in the answers. In your...

Before you prepare the eight adjusting journal entries below in an Excel spreadsheet, please make sure corrections have been made to any previous journal entries. The following are the adjusting...

Mr. Carter is the manager of Simmons Farm and Seed Company, a wholesaler of fertilizer, seed, and other farm supplies. The company has been successful in recent years primarily because of great...

Identify which world stock market has had the best yeartodate return.

Show that, if the radial distribution function is defined as P = r 2 R 2 , then the expression for P for an sorbital is P = 4 2 r 2 2 .

All else the same, which of the following ratios is unaffected by an increase in depreciation? a. Priceearnings (PE) b. Pricebook (P/B) c. Pricecash flow (P/CF) d. Pricesales (P/S).

Suppose that 0.724 mol PCl 5 is placed in a reaction vessel of volume 0.500 L. What is the concentration of each substance when the reaction PCl 5 (g) PCl 3 (g) + Cl 2 (g) has reached equilibrium at...

Explain why the density of vanadium (6.11 g cm 3 ) is significantly less than that of chromium (7.19 g cm 3 ). Both vanadium and chromium crystallize in a bodycentered cubic lattice.

Write an email inviting the stakeholders to a meeting to discuss the internal and external factors, their potential impact and a strategy to address the issues or changes. (80 words) To: Cc: Subject:

Subtract the polynomials. (x+x5)  (xx + 5)

Jessica sold goods to Stacy for $2,500 and retained a security interest in them. Two months later, Stacy filed a voluntary petition in bankruptcy under Chapter 7. At this time, Stacy still owed...

Respondents are a group of organizations dedicated to protecting the environment. (We will refer to them collectively as Earth Island.) They seek to prevent the United States Forest Service from...

On May 7, Roy, a minor, a resident of Smithton, purchased an automobile from Royal Motors, Inc., for $18,750 in cash. On the same day, he bought a motor scooter from Marks, also a minor, for $750 and...

Are the following statements true or false? Explain. (a) FTC I is valid only for positive functions. (b) To use FTC I, you have to choose the right antiderivative. (c) If you cannot find an...

Find the general antiderivative of and check your answer by differentiating. (x) = 2x 4 24x 2

Which of the following pairs of sums are not equal? (a) (C)  1) (b) 5 (d) i(i + 1),j1)j j=2
Question Categories