Staff-T1
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Yup it should be cleaned up - We will get to that
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Good point, I think you are right here - It seems like the graders will accept either a yes or no depending on how you argue it
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Everything you mentioned above is valid, including that using the MCT to determine the RA will understate the true RA needed. I don't actually know how it is done in practice for firms that do proceed with the MCT capital required route, it would de…
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Your method will not be accepted. There's no basis of comparison for your method since you have included discounting and RA in your estimate. The comparison you have is the raw loss cost which does not include discounting and RAs
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No, DAC is not included in the CSM calculation. I explained how DAC is handled in the presence of the CSM above. I do not know what part of sample 22 you are referring to but section a (GMA calculation) clearly does not use DAC as part of its CSM ca…
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Answer key is right and the arguments provided makes sense to me. The question is testing to see if you understand when exactly a contract would be onerous (groups of contracts are expected to generate a net loss going forwards) None of those sta…
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Not for the LRC, no. "Does the 1/3 come from the fact that we are evaluating a group of contracts. Assuming the group has policies in force ranging from 1 day away from expiry to 1 year away from expiry (and those policies are issued uniformly ov…
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Why does it matter whether or not its a cat event?
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I think it is possible that you can attribute the commissions to a group of contracts but still be non-deferrable. But yes, I think this would generally form under acquisition costs
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Did you look at the formulas? It is basically just taking an average of the current and following Accident Year. In other words, Issue Year (x) = (AY (x) + AY(x+1))/2. This is because you expect in a given issue year that half of the claims would co…
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Question 4: They have directly provided you the incremental amounts to be paid out in each of the next 3 years. This is trivial. Question 18: You're calculating the LRC and no time has elapsed which means no adjustment is needed to the payment patt…
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My understanding is that the privy council has already decided before the insurance reference case that federal insurance regulation is ultra vires. The Insurance Reference Case was not a factor in their decision as it comes after it was already mad…
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I think hybrid here just means multiline Option 2 groups based on predominant exposure imo (Property and liability). The liability portion of A is likely low as a % of the total exposure which is why they can be grouped together Option 1 is tricky…
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It would apply to both, but at least for the FCT models that I have seen it is way easier to do it for GMM which is probably why the note is for the PAA approach
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Correct
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Provision for credit losses is always negative. The formula would depend on how it is shown in the income statement. If it is negative then you add it. If it is positive then you would subtract it
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That's right
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yes
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Nope the formula is correct. See question 10 of the published ifrs17 sample questions and the following discussion https://battleactsmain.ca/vanillaforum/discussion/comment/4703#Comment_4703 It is important to not get hooked up on the signs and thi…
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Both Excel files are fine. As I mentioned above, you are looking at the wrong Excel. Capital required and Capital Available are not the same thing
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Nope, you are looking at the excel for section 4.3.3.3 for section 4.3.3.2. The excel file for section 4.3.3.2 is correct
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Why are you trying to apply the formula for a deduction to capital available to the margin required for unregistered reinsurance?
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Yes, you are doing two deductions. They are both different things. The first deduction is meant to penalize capital available based on the amount of unregistered reinsurance that an insurer has which is not collaterized. The second deduction is to…
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In the context of this case, sort of like permission to carry out an act in exchange for paying a penalty
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Cost of reinsurance here is not about the estimation of ceded cash flows but rather the cost of purchasing reinsurance. The risk adjustment here is basically the amount of risk transferred to the reinsurer which is well approximated by the cost of r…
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For non-onerous contracts, inception = initial recognition. In general, all cash flows are always considered to establish the initial CSM. The correct answer should be that LRC = 0 here and this is always true for any non-onerous group of contract…
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The explanation is on page 46 of the LRC paper. It's basically to adjust for the fact that as time passes, a smaller portion of the original coverage remains. Fewer accidents are expected toward the end of the period because fewer risks are still "a…
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yes, 7500 is the remaining DAC
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Yup it is outdated
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Yes you are right