J
Jun Wu
Member
Dear All
Please can I confirm the following concept with you arising from this question Q1:
1. We are given DAC at start of 2017 and we are told commission as % of written premium, and solution did : DAC b/f _2017 / comm % = UPR at start of 2017.
Thank you so much!
Best regards
Jun
Please can I confirm the following concept with you arising from this question Q1:
1. We are given DAC at start of 2017 and we are told commission as % of written premium, and solution did : DAC b/f _2017 / comm % = UPR at start of 2017.
- How does this formula make sense? UPR is the unearned part of written premium, DAC is the deferred part of the AC, are we saying
- So are we saying AC % of WP = commission % WP?? But I always thought commission and acquisition cost are two different items?
- I presume UPR b/f is gross of DAC here, and we are saying the comm % of it is the DAC?
- And when we work out technical reserves : we do UPR + OSC - DAC, because DAC is an expense although being deferred but it is not actually being invested anywhere?
Thank you so much!
Best regards
Jun