Spring 2019 #14b

meowyadoinmeowyadoin
in NAIC.IRIS

Hi, for one year loss development in IRIS 11, the solution add 2015 and 2016's one year development to derive IRIS 11.

But, in IRIS ratio excel pratice problems set 1, you use only CY's 1 year reserve development to derive IRIS 11.

Could you please explain that?

Comments

  • Staff - ACStaff - AC

    In 2019.S.14, what is added is the CY2017 one-year development of each of the accident years 2015 and 2016. This is what's needed for IRIS 11. In the Excel practice, we gave the one-year development of all accident years, for each of CY and CY-1. For IRIS 11, you need to use CY, the current calendar year.

  • elliegreelliegre

    Hi - do you have any thoughts on whether it is necessary to include the range in the answer? Common mistakes say "including the incorrect range" but the question only asks for the IRIS and if it is in the range, if we don't need to include it it seems like a good bet not to include the range because it can only lose us points if we get the range wrong but correctly answer if it is in or out of the range.

    Thanks!

  • Staff - ACStaff - AC

    If you guess at whether it's in range, not give the actual range, and get it right, you may get full points for it. I can't guarantee it, though.

  • lkto22lkto22
    edited May 2023

    hi for 14#d, will it be wrong to use the reserves in schedule P Part 2 to calculate ratio 13? Thank you

  • grahamgraham

    You can't calculate it like that because Schedule P Part 2 shows ultimate losses only. You would need to subtract paid losses to get to the reserves.

    (Note that Part 2 is labelled as "incurred losses" but it's actually "ultimate losses")

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