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
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
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
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