graham
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Sometimes it's very clear which of the 5 options the opinion should be (reasonable, inadequate, excessive, qualified, or none) but sometimes it isn't. There are situations where the actuary must exercise judgment and 2 different actuaries might come…
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I know what you mean. All these things you have to memorize all run together. My S-FEC hint wasn't the greatest. I just couldn't think of anything better. I'll link to your hint from the wiki. Maybe others will find it helpful or inspire them to com…
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The answer in the examiner's report was based on the 2014 edition of Odomirok. In that edition, there were only 3 liabilities items taken directly from Schedule F. In the current (2019) edition of Odomirok, there are now 5 liabilities items listed a…
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https://www.battleacts6us.ca/pdf/NAIC.Ex1_(Travelers)_YE_2018.pdf
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I believe the examiner's report is wrong about (i). Using the reasoning in my previous post from Oct 2020, I believe (i) is a Type 2 event. If (i) were a Type 1 event, then it would have to be reflected in the financial statements (assuming it wa…
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Well, you can do it either way. The way I did it in the practice problem is to check the following inequality: * PV(gross loss - retention) > 110% x (reinsurance premium) But you can rewrite this inequality as: * PV(gross loss - ret…
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That is actually a very good question because it looks like you're given several liability components. The examiner's report gave a very, VERY detailed explanation so I'm guessing the scores on this question were low. And like you said, they specifi…
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I think that might be error in the Odomirok source material. I've got the NAIC Annual Statement Blank for 2019, which is the version listed in the syllabus, and Part 7B shows 7 sections. Sections 6 & 7 in Part 7B are the same as before: * S…
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I meant the Mr. BICUR hint. (Pronounced Mr. Biker) Just so it's clear to everyone, here's the breakdown for the required items in the Relevant Comments section of the SAO. * Materiality * r is for RMAD * B is for Exhibit B * I is for IRIS ra…
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I like the hint but I just want to make sure I know exactly what question this mnemonic is providing the answer to...?
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I think you can make a case for option 1 because the potential loss (100m), the subsequent payout (60%), and the likelihood of the event (15%), are all very high, even given the 20m premium. The insurer is clearly taking on a big risk. And this is p…
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Got it, thx! I've added a note to the end of the holding company example here: * https://battleacts6us.ca/wiki6us/RBC_for_Holding_Companies
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Thx. I threw it in as a parenthetical statement. I could maybe see an exam question that asked you to explain the reason for the 100% allocation versus the 50/50 allocation, for 0.25 pts. I think if you're honing in on details like that then you kno…
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I was going to add a brief note to the wiki on that but when I went to double-check in Odomirok, I couldn't immediately find the reference. What page in chapter 19 are you referencing?
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I will take a look at this and get back to you. Thanks. Next day: Ok, I went back and looked at this: * If "entering a state" means physically entering the state, then you're correct (and the examiner's report is correct.) * If "entering …
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I suppose that could be asked. The quantity (part 2 - part 3) would be case+IBNR so in my own mind, I'd think of it as "case+IBNR" incurred loss although just calling it "incurred" loss also seems reasonable. In the actual exam problem they specific…
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It's a little confusing because the given information is a mixture of CYs (Calendar Years) and AYs (Accident Years). To calculate 2014 year-end liabilities, you need only the table with the Schedule P information. That table shows liability balan…
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Ok, @shuang01, I see the issue now. In your first post, you asked about: * recoverables from parents/affiliates/subsidiaries In your second post, you wrote something slightly different: * Recoverables from an insurer's cession to U.S. …
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Let me try to answer your questions in turn, although I may not be answering exactly what you intended to ask: Why calculate the total benefit? * This is likely an important piece of information in deciding whether to follow through with the…
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According to the text, there is a non-zero risk factor for "recoverables from parents/affiliates/subsidiaries" of 0.05. It's moderate relative to the other R3 items where the risk charges vary from a low of 0.01 (investment income due and accrued) t…
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The benefit to the insurer and the surplus change are the same (at least for this narrow problem.) Surplus equals assets minus liabilities and the commutation is just shifting the assets and liabilities. Assets increase due to the payment from the r…
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I wasn't very clear there. Thanks for noticing that. I've cleaned it up. And I fixed the instances in the BattleCards as well. The JUAs work the same way for WC and auto. When I said in Germani that WC profits and losses are shared among member c…
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Sure, here's a quick definition of each: intercompany pooling: a common arrangement among companies in a group in which each of the participants fully cedes all of its business to the pool leader, and then each participant assumes back a specific…
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I copied the section from the IRIS document below and put further comments down below: For the reasons previously stated, all insurers with ratios greater than 15 percent should be given careful scrutiny regardless of their scores on other ratios…
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From the sample answers, it seems they only wanted 1 of those bullet points for the full 0.5 pts for each sub-part. And the question didn't specify 2 distinct points. The sample answers do seem a little short though because normally for 0.5 pts, you…
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Yes, that's correct. The reinsurance provision is a provision specifically for recoveries that the primary insurer may not be able to collect. So any amounts the reinsurer has already paid play no role. In other they have been "collected" so they do…
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I think this relates to something covered in Exam 5 on pricing. For pricing, we assume commissions & brokerage; other expenses; taxes, licenses, and fees are incurred when a policy is written. But general expenses are incurred over the policy te…
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LOL! Did you realize the first letters spell "CRAP"? In any case, I added it to the wiki. Thx!
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The Vaughan reading was never actually updated. It is from around 2010 but it was removed from the syllabus for 2018 Fall and 2019 Spring then put back on the syllabus for 2019 Fall. No reason was provided. I did not notice that what was consider…
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I did some quick research on this and I discovered that California, New Jersey, and Hawaii do offer government auto insurance. So only 3 states, but CA is a big one, although I don't know what the market share of the CA government program is - maybe…