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When they put it as "adverse development" without any further specification, you need to assume this is incurred development, i.e. development of "everything." Here, they further give that the claim does not touch IBNR. So, you will be assuming t…
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Yes, correct.
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Sure, good luck.
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Sure, good luck.
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Federal income tax equation above is correct. "Gross income" would be synonymous with "revenue," i.e. premium. "Net income" is premium net of loss and expense.
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Tax refunds are not related to tax-based income calculation. Where do you find it said that they get a tax refund only later?
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The Odomirok Tax chapter does not mention underwriting expenses and the wiki formula follows the discourse of this chapter. In fact, as you say, regular and tax-based income are calculated the same way, except for these adjustments, i.e. net of expe…
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PDR is different from UEPR. It is explained in Odomirok Cpt. 22.
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It is more likely that it is the rejecting insurer, not the insured's agent, that forwards to the JUA, because the insured must not be aware of the transfer. The answer key may be in error on this point.
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This exam question was modified for the battle card, and a suitable answer provided.
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Yes, correct.
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According to the S&S section of Odomirok Cpt. 22, Sch P reserves can be gross or net of anticipated S&S. If they are net of S&S, the anticipated S&S is also reported in its dedicated column. In this question, a non-zero anticipate…
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Sure, good luck.
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investment income + realized capital gain = Investment gain attributable to insurance transactions + investment gain attributable to capital and surplus
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All other lines will use calendar year for earned premium and accident year for loss and LAE, except if the line is marked as "claims-made", in which case it will use report year for loss and LAE.
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A type I event must be recognized in the Financial Statement. A type II event must be disclosed in the Notes to the Financial Statement.
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In SAP, this is so.
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Both the current-year and the prior-year surplus figures that go into IRIS 7 need to be netted of surplus aid. IRIS 11 & 12 are not recalculated, because they are not directly related to surplus adequacy, which is what IRIS 4 measures.
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This is incorrect. UEPR is the reserve amount as of end of the calendar year of the statement. Policy Year is not related to this.
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This understanding is correct.
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As per my message above, "prepaid reinsurance premium" is a term used in lieu of ceded unearned premium. As of a given point in time, there will always be a certain portion of paid reinsurance premium that is unearned, due to portion of contract te…
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The difference between statutory and tax accounting's discounting of loss reserves most likely results in higher taxes for the period in question. However, the unwinding of this discount in future periods brings tax benefits, which are measured in D…
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You need to remove UW expenses to get to Income. It is not a part of TBEP, Graham just threw it in with TBEP to make sure it was removed in the resulting Income.
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You are right, this treatment is outdated. The calculation is now undertaken in Schedule F Part 3.
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It most likely goes under cash, like premium.
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UBI is "usage-based insurance." Usually Auto.
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It goes like this: Gross= Direct + Assumed, Direct = Net + Ceded. Your items 1 and 2 are correct, but things like "net and assumed" and "ceded and assumed" are not in common usage.
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Whether insurance price optimization violates the Clayton Antitrust Law would depend on factors such as: Market Power: If insurers with significant market power use price optimization to unfairly exclude competitors or maintain dominance in the m…
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A run-off agreement can be retroactive, prospective, or both, depending on the parties' intention. A novation usually replaces a party to the original contract. Retro/pros status depends on the underlying contract.
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Yes, correct.