I'm not really sure how you would adjust for inflation on the average cost per claim method....and can't find any past exam questions on it. If anyone can explain this to me today i'd be very grateful! Thanks!!
I think you'd apply inflation to the 'cost' table as you would normally as in the chain ladder method (non-cumulative table) and take it from there.
My thoughts are attached as follows. However, recently had an email from the staff actuary after I'd submitted my thoughts and pestered her about whether it was acceptable or not and she said: Re the inflation-adjusted ACPC, the examiners had looked at that but because they felt it was beyond the scope of the syllabus were not going to comment on any specific method. So I think you can assume that it's a complexity which is very unlikely to be asked in CT6! As with anything such as this, a sensible approach would get credit.
