Trend Factors Loss Year Estimated Ultimate Incurred Losses Payroll Exposure Inflation Inflation 2009 1.304 2010 1.251 1.188 2011 2012 917,654 1,094,465 1,474,476 1,397,706 1,134,869 1,053,831 7,073,001 45,000,000 48,000,000 50,000,000 53,000,000 55,500,000 58,500,000 310,000,000 1.609 1.508 1.377 1.262 1.152 1.074 2013 2014 Total 1.144 1.093 1.046 Answers 1) Calculate trended losses, trended payroll, and the pure loss rate per $100 trended payroll in the table above. Year Trended Losses Trended Payroll Pure Loss Rate (Per $100 Trended Payroll) 2009 2010 2011 2012 2013 2014 Total 2) Briefly answer the following questions: What is the average pure loss rate? Would you adjust this average pure loss rate to adjust the loss forecast? Explain. What is the forecasted pure premium for 2015 if the projected 2015 payroll is 60,000,000? Would this firm have to accrue for this loss forecast in 2015? Explain your answer. Trend Factors Loss Year Estimated Ultimate Incurred Losses Payroll Exposure Inflation Inflation 2009 1.304 2010 1.251 1.188 2011 2012 917,654 1,094,465 1,474,476 1,397,706 1,134,869 1,053,831 7,073,001 45,000,000 48,000,000 50,000,000 53,000,000 55,500,000 58,500,000 310,000,000 1.609 1.508 1.377 1.262 1.152 1.074 2013 2014 Total 1.144 1.093 1.046 Answers 1) Calculate trended losses, trended payroll, and the pure loss rate per $100 trended payroll in the table above. Year Trended Losses Trended Payroll Pure Loss Rate (Per $100 Trended Payroll) 2009 2010 2011 2012 2013 2014 Total 2) Briefly answer the following questions: What is the average pure loss rate? Would you adjust this average pure loss rate to adjust the loss forecast? Explain. What is the forecasted pure premium for 2015 if the projected 2015 payroll is 60,000,000? Would this firm have to accrue for this loss forecast in 2015? Explain your