Staff - SJ
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Check out the “common errors” in the Examiner’s Report. It’s hard to say with 100% certainty what would be accepted vs not. I personally think this question could have been worded better. I think P-NEC might get you partial credit, but it coul…
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Yes. Now remember, for the Actuary’s estimates, there is a choice between point or range estimates, but if both are calculated, both must be disclosed. In this case you may want to consider the format of “Sample 2” in the Examiner’s Report for #22c,…
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It is true that the AA must now provide documentation/proof that they are qualified to the Board of Directors once upon appointment (as opposed to every year in the prior requirements), but that doesn't change the wording in the SAO itself. You must…
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I don't think you need to understand all the details of it. It's essentially a 100% quota share agreement - the insurance company is selling (transferring) all the risk elsewhere (another insurance company, a reinsurer, etc).
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Generally, yes - except for the A (accounting basis) in DREARIRR for this question. They would have accepted accounting basis (the A in the acronym) for part A but not likely part B.
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Something does look fishy. We will look into this.
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We will fix this. Investment income excludes realized capital gains. These 2 paragraphs from the COPLFR source text may be helpful: Net investment income earned is primarily related to interest and dividends received on investment assets held ove…
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I wasn't able to find the question you were referring to. It's a fairly complex calculation which is why usually when given a choice, I would defer to % of reserves or % of surplus. You would choose the top end of the next lower RBC range. Set th…
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I believe back in 2016, you had to memorize RBC charge factors - which is probably why you are confused where 0.1/1 used in the solution came from. On exams now, I believe they would have to provide you with the factors/charges. There is more det…
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Yes, on the exam you would make this assumption unless specifically told otherwise. You would need a lot more detail to actually evaluate that yourself. And, this exam does cover some bits of material related to insurance laws, but not nearly enough…
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This question comes from a little red FAQ box in COPLFR. See page 75 here: https://www.actuary.org/sites/default/files/2024-12/casualty-practice-note-saopclossreserves.pdf When a company has 0% participation in intercompany pooling, that means th…
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I believe this relates to Practice Exam 1 created by BattleActs - there's no year associated with it. With the limited info given in this problem, I probably would make an assumption like you described. The key is to very clearly state any assumptio…
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I went back - the 2015 version (likely the one on the Syllabus for a Spring 2016 exam) of COPLFR section 4.10 only says the other actuary must be identified by "name and affiliation" - so the Examiner's Report is outdated. You're correct by the most…
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The AA should still comment on potential RMAD regardless of the opinion type. It’s probably even more important if the opinion is deficient to comment on RMAD, because the company is short on reserves to begin with. There would be an even bigger ris…
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I will update the study sheet and clarify that the Premium & Loss Exhibit is statutory page 14 - that bit comes from a Spring 2014 exam question. The Premium & Loss Exhibit is separate & distinct from both the IEE and U&IE. Here's…
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Your understanding is correct. If a company does not participate in an intercompany pooling agreement, then the only SAO/exhibits that should be included are the ones for that company. Intercompany pooling of 0% means there are no net reserves…
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Policyholder surplus is disclosed on Exhibit B of the SAO (item 7 - called Statutory Surplus. Different name but it's the same thing!). This would be disclosed regardless of what was used for the materiality standard.
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A common error noted in the Examiner's Report is including items other than reserves. Reinsurance payables are not reserves and therefore should not be included. Reinsurance payables are what the reinsurer owes the insurer for claims that have al…
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We will correct this on the BattleCard; I agree after looking at the Examiner's Report. Thanks for your patience!
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I don't believe you need to contemplate the trend test in the example you gave (when it relates to materiality). The trend test is more for the RBC Action Levels.
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That would be technically correct, by COPLFR. However, I think this nuance is a bit in the weeds, and I would guess (and hope?) that the exam writers are aiming to test higher level comprehension around choosing an opinion rather than cherry picking…
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You technically only need to submit Exhibits A and B for the Lead Pooling company in a 0% intercompany pooling situation, not the entire statement. I agree that the examiner's report could be more clear on that particular item.
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It's impossible to know exactly how graders would (or wouldn't!) assign points, especially when source material changes. In my opinion, the answers in the Examiner's Report are still valid and would receive full credit. They do already disclose that…
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No, it is not. Starting with the 2023 practice note, the COPLFR source removed the section about considerations for COVID. I think it's highly unlikely to see a question related to COVID on the exam. I'm currently working on a refresh to the SAO mat…
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Apologies; I misunderstood and mistyped above. You are correct that the intended user should be disclosed in the Identification section. I edited my original comment to reflect that.
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They likely realized the question was defective (because they did not outwardly state whether or not UEPR was in the scope of the opinion) and accepted both answers. This is a good example to point out it's always best to state any assumptions you m…
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No, in my opinion and in this context, reserves and unpaid claim estimates are referring to the same thing (covers case reserves, IBNR, LAE reserves). I guess if you wanted to be really nuanced about it, reserves are an actual dollar amount that …
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I agree that the Examiner's Report could be a bit more clear. Here's my interpretation: * The "Reflect Disclosure Items Exhibit B" in the ER is akin to "reserve items in opinion," from Odomirok 16-17 but.... * You wouldn't list the actual doll…
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Thanks for the note! I looked briefly, and agree that "No Opinion" would be best practice. I'm working on some SAO wiki updates, so I'll include that in my update.
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I'm currently working on a refresh of the COPLFR article, so thanks for pointing this out. Agree that it's very unlikely that a question regarding COVID would appear in the exam, considering the practice note doesn't require any COVID specific comme…