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You are given the following information concerning past workers compensation losses for Doom Factory, Inc (DFI): Accident Year Period Ultimate WC Frequency Number of Employees

You are given the following information concerning past workers compensation losses for Doom Factory, Inc (DFI):

Accident Year

Period

Ultimate WC Frequency

Number of Employees

Incident Rate

2013

1

6,832

14,350

2014

2

6,984

14,750

2015

3

7,068

15,005

2016

4

7,253

15,460

2017

5

7,892

16,893

2018

6

8,124

17,439

2019

7

8,250

17,821

Accident Year

Period

Ultimate WC Frequency

Ultimate WC Losses (000's)

Average Severity

2013

1

6,832

8,325

2014

2

6,984

11,289

2015

3

7,068

16,036

2016

4

7,253

24,012

2017

5

7,892

34,213

2018

6

8,124

50,183

2019

7

8,250

73,565

Given this information, compute the following information for DFI:

  1. The incident rates for 2013-2019. Using these rates, fit an estimation model and provide a forecast for the incident rate for 2020. Show your model. Also show any graphs necessary to justify the model you create.

  1. The average severity for 2013-2019. Using these figures, fit an estimation model and provide a forecast for the average severity for 2020. Show your model. Also show any graphs necessary to justify the model you create.

  1. DFI estimates that it will have 18,150 workers in 2019. Based on the forecasts you determine for the incident rate and average severity, give a forecast of the WC losses for 2020. Show your calculations.

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