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7. You are given the following information on cumulative incurred losses, earned premiums and expected loss ratios: Accident year 2015 2016 2017 2018 2019 Development
7. You are given the following information on cumulative incurred losses, earned premiums and expected loss ratios: Accident year 2015 2016 2017 2018 2019 Development year 0 1 2 3 4 100 200 280 440 440 130 220 320 400 120 200 310 150 200 120 Paid-to-Date Earned Expected as of Dec. 31, 2019 Premium loss ratio 440 500 0.80 400 500 0.75 250 400 0.70 150 600 0.72 80 650 0.60 0 (a) Determine the gross reserve as of Dec. 31, 2019 using (i) Expected loss ratio method (ii) Chain-ladder method (iii) Bornhuetter Ferguson method. Use the mean factor model for the calculation of loss development factors. 7. You are given the following information on cumulative incurred losses, earned premiums and expected loss ratios: Accident year 2015 2016 2017 2018 2019 Development year 0 1 2 3 4 100 200 280 440 440 130 220 320 400 120 200 310 150 200 120 Paid-to-Date Earned Expected as of Dec. 31, 2019 Premium loss ratio 440 500 0.80 400 500 0.75 250 400 0.70 150 600 0.72 80 650 0.60 0 (a) Determine the gross reserve as of Dec. 31, 2019 using (i) Expected loss ratio method (ii) Chain-ladder method (iii) Bornhuetter Ferguson method. Use the mean factor model for the calculation of loss development factors
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