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The command verbs are described on the IFoA website:...

IBNR can be at any level you require depending on the purpose. Triangles will have things split by cohort of course too. What you show in...

You will follow it better if you can put an example together yourself. Create a triangle of paid claims, and perform a BCL on it. Then speed up...

Just to clarify Darshan's response... IBNER can be negative too, when reserves are over-estimated. IBNER is a component of IBNR, but often we say...

Please search the forums before posting! Hopefully this helps: https://www.acted.co.uk/forums/index.php?threads/x6-1ii.19848/

More straightforward than that! These are all 'units'. January: 1 policy sold, at double frequency (risk), so 2 units. February: 1 policy sold...

Google is your friend. Part (iii) of this question is not covered by the Core Reading, but other ways of generating answers are suggested in ASET.

Hi ACSBug As per the suggestion in the links above, the most efficient way to check what you're doing against the solution would be to look...

No missing steps, just stats of expected values, which says E[x]=int[xf(x)dx]

1. Most recent years are very undeveloped, and so little weight should be put on them as the experience to date is uncertain. 2. You may need to...

The loss ratio is constant. So if premiums are going up by 5% each year, then so will the outstanding claims at each subsequent year-end. Then...

If undiscounted reserves are used, reserves will be bigger which will make profits look smaller (bringing losses forward). So if profit...

Those entries of 37.2 and 18.2 are labelled 'change in UPR'. When you follow the calculation of the earned premium (ie written premium minus the...

https://actuaries.org.uk/qualify/examinations-handbook/

Full calculations are shown in ASET (2014-2017). Worth getting that because then you'll have all the other calcs and explanations to hand. If...

Also, I just want to add a little extra to what Katherine says above. The examiners' report is not necessary exactly what the examiners are...

I assume that you understand why the reduction is limited, as there are many reasons why insurers need to hold capital other than for volatility...

That's right - but notice that in the question the limit is being increased. There may also be knock-on effects, eg commissions, contingencies,...

The Study Guide gives you the syllabus and a broad weighting between knowledge, application, etc, but there is no split between chapters - and...

Correct. Yes, that's one way of classifying business. There are of course many others.

I don't think the concept of 'correctly' or 'incorrectly' is useful when reserving. Reserving risk covers the fact that reserves are just...

Have a closer read of the text. 'Risk class' is not mentioned in your the Core Reading you quote. Rather, 'risks in the same class' - ie class...

Both of these queries are very simple examples of the concept of premiums being earned out across two accounting periods. I suggest you revisit...

You'll see in the Examiners' Report that many different solutions were possible for each of the years, depending on the assumptions you make. If...

For part (ii), you need to allow for the uneven incidence of policy inceptions, and the flood. You may get different answers from the examiners...

https://www.acted.co.uk/forums/index.php?threads/sp7-upr-question-on-page-13-of-notes.16390/ Or just draw a graph (should look like a triangle)...

CM2 is presumed knowledge for SP7, and given your questions I do think studying that material first will help you with SP7. I think you're...

I think you'll need to re-study parts of CM2 (previously CT6) before tackling this part of SP7, if you're getting stuck at this point. Reported...

The CMP is available for the 2024 exams - just order via our website in the normal way. You'll find answers to many of your questions if you've...

see chapter 11 page 3.

Yep, Busybee is right. claims incurred is claims paid plus the increase in OSCR. See the last two chapters of SP7 for further details. And yes,...

Try this: https://www.acted.co.uk/forums/index.php?threads/april-2007-question1-part-iv.18790/

I wouldn't read too much into the figures given. All they are suggesting is that if the claim is within the cat component assumption, then it may...

Hi Barns Just basic algebra? Maybe you've not realised that sqrt(n)*sqrt(n)=n. Note your formula in your second post is different from that in...

I've looked at this again. The solution uses the AY figures from earlier in the solution rather than the UY figures in the question. So 2.60 is...

Normally when we talk about a net of reinsurance basis it means both premiums and claims are net of reinsurance, so I can't imagine they'd give...

Hi ActuaryGirl I've trawled through my files and found the attached spreadsheet printout - unchecked - hopefully this may back up the figures...

This is also covered in the ASET - for lengthy calculations it's worth getting that so that you can compare your detailed calculations with the...

https://actuaries.org.uk/contact-us/

See https://www.acted.co.uk/forums/index.php?threads/state-six-reasons%E2%80%A6.18264/

Many things drive premium rates - it's certainly an option to ignore that small flood risk, but the insurer would have to accept the risk of...

Yes, that's right. For EML estimation, see Chapter 6 page 8.

Just search for 'ACPC' in these forums and you'll find plenty of explanations. Which method you choose could well depend on the data you've been...

I don't think you're missing anything. At the end of the day, the PAYG premiums could be lower or higher than funded premiums depending on a...

Reinsurance doesn't (necessarily) improve the overall cashflow to the insurer (and notice that you've left off claims and other expenses in your...

I think you're confusing 'inflation' with 'development'. Claims incurred can easily reduce if your estimate of outstanding improves (gets lower)...

By the way, papers older than 1999 are available from the IFoA library (Oxford or London I believe). The librarian there has been helpful in the...

They are both generic terms. An exit strategy is just a method of getting out of a line of business - for example, by using commutations,...

That's right. The insurer is just changing from one entity to another.

Yes, you could use both examples for each sub-type. Mesothelioma is the 'worst' of the asbestos-related diseases, and so is sometimes worthy of...

Hi Kanishka Can you be more specific about which bit you don't follow? Reinsurance commission is paid by the reinsurer to the cedant, largely to...

Hi Anmol I wouldn't worry until you get there. Get stuck into SP8 nice and early when the time comes, and if you find an area that you're rusty...

Well spotted! The Lloyd's website says that "Large company members of Lloyd’s are not required to have members’ agents. They may appoint a...

No definitive rule I'm afraid. In the distant past, when the pass mark was lower, there were plenty of halves and not many 1s. These days, with...

There's no hard and fast rule about how to classify 'large', 'cat' or 'man-made'. It's all subjective.

1. I read it to mean that they check annually, and if one LoC drops out (eg after the four years), then it should be replaced. I may be wrong...

1. I'd imagine because their risk tolerance is lower. 2. The Use Test is all about showing that your model (and hence the assumptions within it...

p12: that's right. p13: I think this paragraph is trying to say that sometimes you may get insurance and reinsurance arrangements acting...

Q5: I think the point being made is that the investment income is on the technical provisions, so anything affecting the calculation of tech...

Thanks to Busy_Bee. Just to clarify method 3 - yes, it's looking at the historical incurred if it was ever above the threshold.

Q1: This is covered more by Subject SP7, rather than Subject SA3 Chapter 4. Sufficient capital is a valid extra point, although it might already...

1) the implication is that the retainer fee is definitely going to be paid and is therefore incurred, it just hasn't been paid yet. 2) estimates...

Please have a read of the Subject SA3 Study Guide. You'll see there that SP7/8 knowledge is very much needed for SA3. There's no such subject as...

Hi Daithi Some of Chapters 1-10 are identical (eg products and reinsurance) but some are different (some more so than others). However, the...

No, the Core Reading for SP8 is required knowledge for SA3, and has often been examined directly in the SA3 exam. Reading around the subject will...

Tech reserves for 2003 = 640 =1.25*WP for 2002+UPR b/f (net of DAC) Uses 8th bullet point in the question. End free reserves = start free...

Search for '2005' within the SA3 forum and you'll find quite a few threads on this.

Not exactly sure which figure you're questionning and haven't looked at the specifics - but I did manage to find the attached which hopefully...

Hi guys If you search for '2007' in the SA3 forum specifically, you'll find a fair few threads already on this question. The bottom line is...

1. Yes, there are differences but the general idea is consistent as the GMM/PAA are for unexpired risks. 2. That's my understanding, yes.

help me out here - which year exam am I looking at?

It's a generic term, just referring to the fact that an increase in a very large claim will hit the reinsurer 100% (as the claim is already...

Hi N15 Sorry, I don't know, tutors don't get involved in the exam checking process, so I'm afraid you'd have to ask the IFoA. Ian

This question is effectively about diagnostics. We cover it in SP7 tutorials. This part of the question is asking whether the BCL will still be...

Effectively, yes. It's provided a year at a time, but is held in the PTF for the 3 years, for each YoA. RITC is just the process of transferring...

https://www.acted.co.uk/forums/index.php?threads/some-numeric-parts-of-403-2-questions.1449/#post-6901

Again, no strict definition. For example, some take it to mean increase in both frequency and severity, some just severity. So again, just say...

There's no strict definition, Jun. Many practitioners take trending to mean adjusting solely for claims inflation, but others interpret it to...

These two years were a smaller series of webinars due to Covid. Back to normal this year.

Hi Pooja This is also in the SP7 notes - see https://www.acted.co.uk/forums/index.php?threads/sp7-upr-question-on-page-13-of-notes.16390/ The...

No: When you do a triangulation, you're always going to end up with the same ultimates regardless of the cohort used (think about it, if I gave...

Yes, see Chapter 12 page 35.

Hi Padasala The tax rules on equalisation rules have changed since this exam was written. Transfers to/from are no longer relevant for tax...

Actually, Mavvj is correct! And yes, there have been plenty of past questions asking for a specific number of something.

that's correct, mgh. Ian

No reason why not, reinsurance calcs are pretty common in both SP7 and SP8 exams, and the SA3 syllabus is no more demanding in terms of the...

It's only like this because of the wording of the question (normal commissions are normally expressed as a percentage of the ceded premium). Your...

Maybe a clue on the year and sitting, Ed? :)

Hi Trevor If the IFoA have asked you to use 2.0 line spacing, then I would use 2.0 line spacing. I very much doubt you'd get penalised for doing...

Hi Smith, This is another question that's fully covered in ASET (2014-2017 papers). You may save some frustration with all these recent questions...

Hi Trevor You'll see in more recent papers that the expected word count is no longer given. You can of course still lose marks for excluding...

The sentence only mentions capital modelling here because the syllabus objective for this chapter/unit is specifically about how risk and...

Yes, for the example above, that would be enough to score the full 1 mark. However, sometimes the points in the examiners report are the 'short...

That's a very open question! Perhaps you can be more specific about which element you don't understand? Splitting data into various homogenous...

They used to be available from the IFoA library (Oxford and/or Staple Inn). If you contact the librarian you should be able to find out how to...

Yes, there are definitions. See the Glossary for the first two, and a dictionary for the third! There's a little overlap in the first two as...

It won't do you any harm (apart from use up valuable study time which, arguably, might be better used in other ways), but I wouldn't go too far...

Not sure! Page 27 of Chapter 4 is the Core Reading's take on it, which is the material you should concentrate on, and is nowhere as detailed as...

This is all covered further in Chapters 4 and 9. 2006 was a long time before S2, and IFRS17 has yet to start even now, so this past exam question...

I don't know of any, but there may be more info on the IFoA website, under the sustainability section, which you could look through to see if that...