Prepare the loss and LAE inputs to a rate indication, applying standard ratios and loss adjustments and distinguishing claims-made from occurrence coverage.
Free CAS Exam 5 (Basic Ratemaking and Reserving) lesson in Ratemaking. 24 min read, ~3,659 words.
Frequency, severity, pure premium, and loss ratio are the four common ratios; keep the claim definition consistent between numerator and denominator. Losses fed into a rate indication are developed to ultimate, trended to the future cost level, and adjusted for catastrophes, shock claims, and benefit-level changes before you divide by...
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What this lesson covers
- Content
- Example 1
- Example 2
- Example 3
- Example 4
- Common Mistakes
- Check Your Understanding
- Exam Shortcuts
Learning objectives
- A6
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