Calculate projected losses using trend analysis.
Free SOA Exam ASTAM (Advanced Short-Term Actuarial Mathematics) lesson in Reserving and Pricing for Short-Term Insurance Coverages. 11 min read, ~1,585 words.
Projected loss = historical loss × trend factor × loss development factor (other adjustments as needed). Trend factor =, where is the annual trend rate and is the trend period in years (mid-point to mid-point). Two-step trend: past trend from experience mid-point to an anchor date, future trend from the...
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- Example 1
- Example 2
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Learning objectives
- 6c
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