You have been asked by an insurance underwriter to calculate the Unearned Premium Provision (UPP) that...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
You have been asked by an insurance underwriter to calculate the Unearned Premium Provision (UPP) that should be raised with respect to the following policies adopting the 24ths methodology. Inception Date Policy Number 1 2 3 4 14/01/2019 19/04/2019 01/07/2019 27/10/2019 Premium (£) 1,500 3,450 2,110 1,850 A non-life insurer called Catmac Insurance Plc issues new policies writing £17,000 in premiums during the accounting year ending 31 December 2019. Note that the premiums are collected upfront and policies have an annual coverage period. At the end of the year the company estimates that on these insurance contracts an Unearned Premium Provision of £6,300 should be raised. During the year, through a proportional reinsurance treaty, the company ceded 25 percent of written premiums, technical provisions and incurred claims. Calculate the Net Earned Premium for Catmac Insurance Plc for the 2019 accounting year. Given the information provided in Question 8, during the following accounting year (1 January 2020 to 31 December 2020), the non-life insurer issues new policies with premiums of £25,300. Once again the premiums are collected upfront and policies have an annual coverage period. At the end of the year (31 December 2020) the company estimates that on the policies it issued during the new accounting year, an unearned premium provision of £7,000 should be raised. During the year, through a proportional reinsurance treaty, the company ceded 10 percent of written premiums, technical provisions and incurred claims. Calculate the Net Earned Premium for Catmac Insurance Plc for the 2020 accounting year. You have been asked by an insurance underwriter to calculate the Unearned Premium Provision (UPP) that should be raised with respect to the following policies adopting the 24ths methodology. Inception Date Policy Number 1 2 3 4 14/01/2019 19/04/2019 01/07/2019 27/10/2019 Premium (£) 1,500 3,450 2,110 1,850 A non-life insurer called Catmac Insurance Plc issues new policies writing £17,000 in premiums during the accounting year ending 31 December 2019. Note that the premiums are collected upfront and policies have an annual coverage period. At the end of the year the company estimates that on these insurance contracts an Unearned Premium Provision of £6,300 should be raised. During the year, through a proportional reinsurance treaty, the company ceded 25 percent of written premiums, technical provisions and incurred claims. Calculate the Net Earned Premium for Catmac Insurance Plc for the 2019 accounting year. Given the information provided in Question 8, during the following accounting year (1 January 2020 to 31 December 2020), the non-life insurer issues new policies with premiums of £25,300. Once again the premiums are collected upfront and policies have an annual coverage period. At the end of the year (31 December 2020) the company estimates that on the policies it issued during the new accounting year, an unearned premium provision of £7,000 should be raised. During the year, through a proportional reinsurance treaty, the company ceded 10 percent of written premiums, technical provisions and incurred claims. Calculate the Net Earned Premium for Catmac Insurance Plc for the 2020 accounting year.
Expert Answer:
Answer rating: 100% (QA)
To calculate the Net Earned Premium NEP for Catmac Insurance Plc for the 2019 and 2020 ... View the full answer
Related Book For
Auditing Cases An Interactive Learning Approach
ISBN: 978-0133852103
6th edition
Authors: Mark S. Beasley, Frank A. Buckless, Steven M. Glover, Douglas F. Prawitt
Posted Date:
Students also viewed these accounting questions
-
You have been asked by a client to review the records of Roberts Company, a small manufacturer of precision tools and machines. Your client is interested in buying the business, and arrangements have...
-
You have been asked by a client to review the records of Inteq Corporation, a small manufacturer of precision tools and machines that follows ASPE. Your client is interested in buying the business,...
-
The Glory Mountain State Ski Are expects to attract 292,500 skier days during the coming ski season. A skier day represents one skier at the mountain for one day. In addition to a $ 2,000,000 per...
-
As Paradise Properties CEO Ajanee Kallapur began thinking about what aspects of sustainability were most important for Paradise Cove, she realized that success of the hotel was critically linked to...
-
The binary data stream 001101001 is applied to the input of a duobinary system. (a) Construct the duobinary coder output and corresponding receiver output, without a precoder. (b) Suppose that owing...
-
A fully loaded Boeing 777-200 jet transport aircraft has a mass of \(325,000 \mathrm{~kg}\). The pilot brings the 2 engines to full takeoff thrust of \(450 \mathrm{kN}\) each before releasing the...
-
Environmental compliance: a market opportunity. Table 2.1 shows estimates of the size of the market for environmental technologies and services needed to comply with environmental standards. In 1996...
-
The condensed product-line income statement for Suffolk China Ware Company for the month of December is as follows: Fixed costs are 15% of the cost of goods sold and 40% of the selling and...
-
4. A 1.2 x 103 kg Toyota Echo is accelerating down a hill. The hill is 150. m long and the total decline in elevation of the hill is 15 m. The car accelerates from a speed of 2.0 m/s at the top of...
-
Pie Corporation acquired 75 percent of Slice Companys ownership on January 1, 20X8, for $96,000. At that date, the fair value of the noncontrolling interest was $32,000. The book value of Slices net...
-
/01- Given the dataset with two features x1, x2 and the class labels (+,-): A(10. 10. +), B( 40. 10. +). C(10,40, +). D(30.30.-). 855 23/10/0 Illustrate the first 2 iterations of Ada Boost ensemble...
-
There is a lizard known as the Yellow Spotted Lizard in our proposed project area that was listed as a threatened species under the Endangered Species Act (ESA) on September 2, 2019. The local high...
-
A spring oscillator is designed with a mass of 0.252 kg. It operates while immersed in a damping fluid, selected so that the oscillation amplitude decreases to 1.00% of its initial value in 9.47 s....
-
Tacko Fall is a college basketball player from Dakar, Senegal.His picture with the CBS reporter, Tracy Wolfson, became anovernight sensation during March Madness in 2019 as it clearlyhighlighted how...
-
Liquidity ratios denote the current ability to pay short term debt obligations like accounts payable, accruals, etc. The higher the ratio the more liquid. What is the difference between current and...
-
Demand for GeForce RTX 4090 graphic card at NVIDIA from its North and South America markets for the last 4 years are as follows: Year 2019 2020 2021 2022 Quarter Q1 Q2 Q3 Q3 Q4 Q3 Q2 Q3 Q4 Demand...
-
Question 3 A car starts moving at time t = 0 and as time increases the velocity increases as tabulated below. Table 1: Time vs Velocity t (sec) v (m/sec) 0 0 3 3 6 7.6 9 13.7 12 22.9
-
What are some of the various ways to implement an awareness program?
-
Based on what you have read related to sustainability reporting, what do you believe are the possible advantages and disadvantages associated with issuing a sustainability report to external...
-
PCAOB Auditing Standards No. 8, Audit Risk, provides guidance about the auditor's consideration of audit risk in an audit of financial statements. Visit the PCAOB's website (www.pcaob.org) to obtain...
-
One of the environmental factors affecting judgment is the "rush to solve" judgment trap. Briefly describe the trap and how it applies to the situation affecting the recording of the sales...
-
What is reaction coordinate? What is its significance in chemical reaction?
-
Show that for steady state flow process, \(\Delta H=Q-W_{S}\).
-
An ideal gas \(\left(C_{P}=5, C_{V}=3 ight)\) is changed from \(1 \mathrm{~atm}\) and \(22.4 \mathrm{~m}^{3}\) to \(10 \mathrm{~atm}\) and 2.24 \(\mathrm{m}^{3}\) by the reversible process of heating...
Study smarter with the SolutionInn App