Can anyone explain to me how to find the clue in the question that will allow me to use the correct year when calculating the gross premium prospective reserves? For example in the revision books for CM1, booklet 8. In Q14 (or CT5 September 2010 Q12.), the prospective reserve is calculated prospectively at year 10 instead of year 9. However if you read, Q18 in the same booklet (or CT5 Q12 April 2011). The Gross premium reserve is calculated at year 23 instead of year 24. To me these questions look the same and I cannot understand why in Q14 we have to use the following year and in the Q18 we have to calculate it prospectively from the current year.
Hi I would think about actual times on a timeline instead of years. In Q14 we want the reserve on 31/12/09 which is virtually 1/1/10. That is time 10 (given time 0 was 1/1/00). Similarly in Q18, we want the reserve on 31/3/11 which is virtually 1/4/11. That is time 23 (given time 0 was 1/4/88). Bev
Thank you, that was me being silly, I was thinking of it in terms of t and t+1 integers as seen in the recursive formula.
