RE: Re: after exam

Mike_Adams@ncci.com
Mon, 11 May 1998 13:32:51 -0400

This question is very ambiguous, and should prompt a question to the CAS.
Both C and B are stabilizing values. C is defined as being a stabilizing
value by Tiller, but in all honesty, so is B. In fact, in a past Part 6
question, the CAS asks the meaning of B and the model answer is "a
stabilizing element." Also, in past CAS exam questions, they were always
careful to explicitly state whether the C or B value was being used, so
that confusion could be avoided. But they did not do that this time
around. At NCCI we use the formula with the B, but of course that is the
real world, not the exam world. Hopefully, due to the obvious confusion
this caused, both possible answers will be accepted.

jnielsen@amre.com on 05/11/98 02:04:38 PM

To: studygroup6@lists.casact.org
cc: driek@transre.com (bcc: Mike Adams/BOCA/NCCI)
Subject: RE: Re: after exam

I answered this question using the formula [ A(p) + C + w*A(e)]/[E(p) + C +
w*E(e)] because the definition of C is that it is a stabilizing value,
whereas B is based on C and derived from Table M. Since there was no
mention of table M in the question, I assumed this formula to be correct
and my answer was 1.468 (answer C).

driek@transre.com on 05/11/98 12:53:00 PM

To: aact@shore.net, studygroup6@lists.casact.org
cc: (bcc: Jill Nielsen/AmericanRe)
Subject: RE: Re: after exam

Did anyone else do the question on the NCCI Experience Rating? It was
numero
19 on multiple choice. They did not indicate which formula to use yet the
answer (from A-E choices) mattered depending on which one chosen. Any
comments?
It was the one where the stablizing factor was either C or B?
DR
-----Original Message-----
From: aact [SMTP:aact@shore.net]
Sent: 11 May 1998 17:46
To: Riek, David; studygroup6
Subject: Re: after exam

I also thought the exam was pretty straightforward. Did anybody else not
use the discounted numbers in Feldblums problem because it asked for
Underwriting Profit? I showed discounted numbers, but ended up using
non-discounted since they asked for Underwriting profit.
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Actuarial Department
AIB of Massachusetts