Question
Answered step-by-step

You work with the pricing actuary at Cash for Claims, a large...

You work with the pricing actuary at Cash for Claims, a large Property/Casualty insurer. The CEO has some questions based on the most recent pricing analysis and the pricing actuary has asked you to assist with the response.

The proposed rates were not in the range the CEO expected given the pricing analysis. The CEO has asked the pricing actuary to verify the total projected loss cost excluding potential large storm losses for 2020. In turn, the pricing actuary has asked you to independently calculate the projected costs.

All policies are 12-month policies. The rates will take effect July 1, 2020 and will be in effect for one year. In 2017 there was a large storm resulting in an additional 230 storm-related claims averaging 30,000 each. The company was able to settle 40% of all total claim liabilities relating to those claims within 2017 with the remainder being paid out in 2018. All other claims are completely settled by the end of year 4. The pricing actuary determined trend factors using the least squares method and determined the projected loss cost based on the loss costs for 2018 and 2019 with weightings of 40% and 60% respectively. You are to use the same methodology. The data and underlying model are in the Excel worksheet <Excel File GI>.

Your response should be formatted as an internal memorandum to the pricing actuary and should include the projected loss costs for 2018 and 2019.

Answer & Explanation
Verified Solved by verified expert

trices ac magna. Fusce dui l

ec facilisis. Pellentesque dapibus efficitur laoreet. Nam risus ante, dapibus a molestie consequat, ultrices ac magna. Fusce dui lectus, congue vel laoreet ac, dictum vitae odio. Donec aliquet. Lorem ipsum dolor sit amet, consectetur adipiscing elit. Nam lacinia pulvinar tortor nec facilisis. P

Unlock full access to Course Hero

Explore over 16 million step-by-step answers from our library

Subscribe to view answer
Step-by-step explanation

e ve

18063209

gue

ec facilisis. Pellentesque dapibus efficitur laor

, ultrices ac magna. Fusce dui lectus, congue vel laoreet ac, dictum vitae odio. Donec aliquet. Lorem ipsum dolor sit amet, consectetur adipiscing elit. Nam lacinia pulvinar tortor nec facilisis. Pellentesque dapibus efficitur laoreet. Nam risus ante, dapibus a molestie consequat, ultrices ac magna.

18063211

gue

onec aliquet. Lorem ipsum dolor sit amet, consectetur adipiscing elit. Nam lacin

ur laoreet. Nam risus ante

entesque dapibus efficitur laoreet. Nam risus ante, dapibus a molestie co

18063215
18063216

gue

ng elit. Nam lacinia pulvinar tortor nec facilisis. Pellentesque dapibus efficitur laoreet. Nam risus ante, dapibus a molestie consequat, ultrices ac magna. Fusce dui lectus, congue vel laoreet ac, dictum vitae odio. Donec aliquet. Lorem ipsum dolor sit amet, consectetur ad

sum dolor sit amet, consectetur adipiscing elit. Nam lacinia pulvinar tortor nec facilisis. Pellentesque dapibus efficit

lestie consequr laoreet. Nam risum ipsum dolor
ceac,su
scesu
ec aaciniaamet
fa molesta molest
suDonec ainia pul
ac,m ipsumipsum d

a. Fusce dui lectus, congue vel laoreet ac, dictum vitae odio. Donec aliquet. Lorem ipsum dolor sit amet, consectetur adipiscing elit. Nam lacinia pulvinar tortor nec facilisis. Pellentesque dapibus efficitur laoreet. Nam risus ante, dapibus a molestie conseq

lestie consequat, ultri

  1. ec aliquet. Lorem ipsum dolor
  2. trices ac magna. Fusce dui lect
  3. , ultrices ac magna. Fusce dui lectus, cong
  4. tesque dapibus efficitur laoreet. Nam ris

ctum vitae odio. Donec aliquet. Lo

o. Donec aliquet. Lorem ips

entesque dapibus efficitur laoreet. Nam risus ante, dapibus a molestie consequat, ultrices ac m

ipiscing elit. Nam lacinia pulvinar tortor nec facilisis. Pellentesque dapibus efficitur lao

gue

4 Attachments
image(177).png
png
image(178).png
png
image(179).png
png
image(180).png
png