Hi, hope everyone's SA3 study is going well.
Please could someone confirm my understanding....or correct me if I am wrong on the following:
If BCP is based solely on one clients experience i.e full credibility, it's not really insurance. This is because the insured is effectively paying back what they have received in claims. All the insurer is doing is smoothing these claims over a given period and providing an administrative service.
So why would anyone ever use a BCP method with full credibility then?
If the above statement is true, is it applicable to September 2004, paper 2, question 1 part iv) ?
I know the above may perhaps be a bit stupid but hey.....
Thanks
Last edited by a moderator: Sep 7, 2007