Assume Storrs Insurance Company (a Property Casualty company) has the following data for 12/31/2016:

• Total Assets = $90M
  • Fixed Income assets = $60M
  • Equity assets = $20M
• Total liabilities= $75M
  • Loss Reserves = $45M
  • Unearned premium reserves = $25M
• Premiums for calendar year 2016 = $30M

Assume that for RBC purposes:

• R0 = 0
• R1 factor for its blend of fixed income assets = 5%
• R2 factor for equity assets= 20%
• R3=0
• R4 factor for underwriting risk, loss reserves = 15%, Unearned Premium reserves = 10%
• R5 factor for underwriting risk, premiums= 30%

1. What is the Authorized Control Level (ACL) for Storrs for year-end 2016?