S
Salma
Member
Hello
can someone please explain why in in Q1, we don't use the recursive formula given in the Recursive calculation of reserves guidelines: tV = (-CFt+1 + t+1V*Px+t)/(1+i)
Is it because the question states: "...the company calculated the gross premium reserve based on actual experience."? I.e.; it doesn't mention Prospective gross premium reserve?
If not then how do we determine which method to use to calculate gross premium reserves?
Any explanation would be much appreciated! Thank you
can someone please explain why in in Q1, we don't use the recursive formula given in the Recursive calculation of reserves guidelines: tV = (-CFt+1 + t+1V*Px+t)/(1+i)
Is it because the question states: "...the company calculated the gross premium reserve based on actual experience."? I.e.; it doesn't mention Prospective gross premium reserve?
If not then how do we determine which method to use to calculate gross premium reserves?
Any explanation would be much appreciated! Thank you