ASOP 43 Flashcards

1
Q

Actions the actuary must take if constraints apply to the analysis which may potentially materially impact the results

A
  • Notify the principal of the risk
  • Communicate the constraints to the principal
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2
Q

Items regarding the unpaid claim estimate that need to be identified by the actuary

A
  • Intended measure of the unpaid claim estimate, in addition to whether it is discounted
  • whether the reserve is gross or net of specified recoverables
  • extent of reinsurance collectability risk
  • types of unpaid claim adjustment expenses included in the unpaid claim estimate
  • the claims covered by the estimate
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3
Q

Factors that the actuary should consider when determining the appropriate method to derive the reserves

A
  • Purpose (internal analysis vs external reporting)
  • Nature of claims & exposure
  • Development characteristics of the claims
  • Characteristics of the available data
  • Applicability of various methods to the available data
  • Reasonableness of the assumptions underlying the various methods
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4
Q

Items that need to be disclosed when deriving the unpaid claim estimate

A
  • Intended purpose(s) of the estimate.
  • Significant limitations
  • Scope
  • Accounting date, Valuation date & Review date
  • Specific significant risks & uncertainties
  • Significant events, assumptions or reliances that have a material impact on the estimate.
  • Basis for the range
  • If the estimate is an update of a prior estimate, changes of assumptions, procedures or methods that had a material impact
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