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?
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.