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Schedule F: Restate Balance Sheet

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Restate the balance sheet to gross of reinsurance as in Schedule F, Part 8. If an answer cell is 0, you can either enter 0 or leave it blank. (Modeled on 2017.Fall #14) P.S. Shout-out to TD!

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FUN TRICK! Click the 'Submit' button without entering any numbers. This quickly shows you (green highlights) all the places that have an entry of 'zero'. Then click 'New' if you want to try the problem for real.

ceded loss & LAE reserves (Schedule P, Part 1 Summ., Cols 14+16+18+20+22)
ceded unearned premium reserves (Schedule F, Part 3, Column 13)

item

Assets
net of
ceded

adjustment
GROSS of
ceded
1 cash & invested assets
2 premiums & considerations
3 reinsurance recoverables on loss & LAE payments
4 funds held by OR deposited with reinsured companies
5 other assets
6 net amount recoverable from reinsurers
7 TOTAL ASSETS (net & gross totals may be different)

Liabilities
net of
ceded

adjustment
GROSS of
ceded
8 losses & LAE
9 unearned premiums
10 advance premiums
11 dividends declared & unpaid
12 ceded reinsurance premiums payable
13 funds held by company under reinsurance treaties
14 provision for reinsurance
15 TOTAL LIABILITIES (net & gross totals may be different)
16 SURPLUS (no change to surplus)
17 TOTAL (from above)

Basic Formula

GROSS of ceded
= (net of ceded) + (adjustment)

Adjustments

items 3,12,13,14: (corresponds to Schedule F, Part 8, lines 3,14,15,17)
   - simple reversals of the given ceded amounts

item 4:
   - no adjustment since this amount relates to assumed reinsurance (we want to adjust for ceded reinsurance)

items 8,9: (corresponds to Schedule F, Part 8, lines 9,11)
   - add the ceded amounts from Schedules P & F back into the corresponding net amounts

item 6: (corresponds to Schedule F, Part 8, line 6)
   - this is a balancing item that forces the total asset adjustments to equal the total liabilitiy adjustments

Item 6 Formula

adjustment
= (total liability adjustments) – (adjustment to reinsurance recoverables on loss & LAE payments)

Solution:

item

Assets
net of
ceded

adjustment
GROSS of
ceded
1 cash & invested assets
2 premiums & considerations
3 reinsurance recoverables on loss & LAE payments
4 funds held by OR deposited with reinsured companies
5 other assets
6 net amount recoverable from reinsurers
7 TOTAL ASSETS (net & gross totals may be different)

Liabilities
net of
ceded

adjustment
GROSS of
ceded
8 losses & LAE
9 unearned premiums
10 advance premiums
11 dividends declared & unpaid
12 ceded reinsurance premiums payable
13 funds held by company under reinsurance treaties
14 provision for reinsurance
15 TOTAL LIABILITIES (net & gross totals may be different)
16 SURPLUS (no change to surplus)
17 TOTAL ASSETS (from above)