1. Assume you are given the following table of claims per year on a group of insurance policies. Policy Year Development Year 0 1 2 3 4 2014 117.86 77.72 77.93 44.03 14.86 2015 182.84 88.90 40.42 40.23 2016 151.66 127.39 59.69 2017 178.50 101.98 2018 118.18 a) Using the volume weighted development factors, determine the reserve that should be held for the incurred but not reported claims. b) Using the year weighted development factors, determine the reserve that should be held for the incurred but not reported claims. c) Now use the volume weighted development factors but assume historical inflation with an annual effective rate of 3%. Do not assume any inflation in the future. Determine the reserve that should be held for the incurred but not reported claims.
1. Assume you are given the following table of claims per year on a group of insurance policies. Policy Year Development Year 0 1 2 3 4 2014 117.86 77.72 77.93 44.03 14.86 2015 182.84 88.90 40.42 40.23 2016 151.66 127.39 59.69 2017 178.50 101.98 2018 118.18 a) Using the volume weighted development factors, determine the reserve that should be held for the incurred but not reported claims. b) Using the year weighted development factors, determine the reserve that should be held for the incurred but not reported claims. c) Now use the volume weighted development factors but assume historical inflation with an annual effective rate of 3%. Do not assume any inflation in the future. Determine the reserve that should be held for the incurred but not reported claims.
MATLAB: An Introduction with Applications
6th Edition
ISBN:9781119256830
Author:Amos Gilat
Publisher:Amos Gilat
Chapter1: Starting With Matlab
Section: Chapter Questions
Problem 1P
Related questions
Question
Please do the following questions with full handwritten working out
Transcribed Image Text:1. Assume you are given the following table of claims per year on a group of insurance
policies.
Policy
Year
Development Year
0
1
2
3
4
2014 117.86
77.72
77.93
44.03
14.86
2015
182.84
88.90
40.42
40.23
2016
151.66 127.39
59.69
2017
178.50 101.98
2018
118.18
a) Using the volume weighted development factors, determine the reserve that should be
held for the incurred but not reported claims.
b) Using the year weighted development factors, determine the reserve that should be
held for the incurred but not reported claims.
c) Now use the volume weighted development factors but assume historical inflation with
an annual effective rate of 3%. Do not assume any inflation in the future. Determine the
reserve that should be held for the incurred but not reported claims.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 2 steps with 6 images
Recommended textbooks for you
MATLAB: An Introduction with Applications
Statistics
ISBN:
9781119256830
Author:
Amos Gilat
Publisher:
John Wiley & Sons Inc
Probability and Statistics for Engineering and th…
Statistics
ISBN:
9781305251809
Author:
Jay L. Devore
Publisher:
Cengage Learning
Statistics for The Behavioral Sciences (MindTap C…
Statistics
ISBN:
9781305504912
Author:
Frederick J Gravetter, Larry B. Wallnau
Publisher:
Cengage Learning
MATLAB: An Introduction with Applications
Statistics
ISBN:
9781119256830
Author:
Amos Gilat
Publisher:
John Wiley & Sons Inc
Probability and Statistics for Engineering and th…
Statistics
ISBN:
9781305251809
Author:
Jay L. Devore
Publisher:
Cengage Learning
Statistics for The Behavioral Sciences (MindTap C…
Statistics
ISBN:
9781305504912
Author:
Frederick J Gravetter, Larry B. Wallnau
Publisher:
Cengage Learning
Elementary Statistics: Picturing the World (7th E…
Statistics
ISBN:
9780134683416
Author:
Ron Larson, Betsy Farber
Publisher:
PEARSON
The Basic Practice of Statistics
Statistics
ISBN:
9781319042578
Author:
David S. Moore, William I. Notz, Michael A. Fligner
Publisher:
W. H. Freeman
Introduction to the Practice of Statistics
Statistics
ISBN:
9781319013387
Author:
David S. Moore, George P. McCabe, Bruce A. Craig
Publisher:
W. H. Freeman