Error in solution for Chapter 21 Question 21.8?

Discussion in 'CM2' started by Bill SD, Jul 19, 2022.

  1. Bill SD

    Bill SD Very Active Member

    Hi,
    Q21.8 is using the inflation adjusted chain ladder method. For step 1 (applying past inflation factor to incremental data), the solution (pg 65, first table) gives the incremental claim fro accident year 2012 and development year 2 as: 71.4.

    But shouldn't this be 74.97 since = 68 * 1.05*1.05?
     
  2. Busy_Bee4422

    Busy_Bee4422 Ton up Member

    The incremental value 68 is the claims paid at mid-year 2014. We want values at mid-year 2015 so we accumulate with 1 year, not 2 years.
     
    Bill SD likes this.

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