2019F Q20.d
Sample solution 2 for part (d) says that the capital available will go down. Reinsurance is not part of category A, B or C capital. Can anyone help me understand why it would go down? Thanks!
https://battleactsmain.ca/pdf/Exam_(2019_2-Fall)/(2019_2-Fall)_(20).pdf
Comments
Your available surplus will decrease as your liabilities will increase (unpaid increases due to no reinsurance) and assets (reinsurance receivables) will decrease. Surplus is part of capital available