Use I: observe split between actuarial reserves (IBNR) and case reserves

Taken from your table.
I'm not sure how we would use part 5 here? I would think it would be Parts 2, 3, 4, since case = 2 - 3 - 4

Comments

  • I took the answers in that table directly from this exam problem:

    I see your point but I also don't think they graded this too strictly. I suspect if you had listed "Parts 2,3 4", you would also have gotten credit because it shows you knew that Part 4 shows IBNR. When the source text says, "observe split between actuarial reserves (IBNR) and case reserves", there could be multiple different ways of performing that analysis. All they were testing here is whether you knew a few other uses for Schedule P and that you had at least some idea of which exhibits were relevant.

    I guess I don't really know what you would do with the counts from Part 5 in this analysis. Maybe it could result in a more precise analysis although I haven't thought enough about it to know what that would be.

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