17 Questions
What is the formula to calculate the rate per exposure unit by pure premium method?
Pure premium + Expenses per exposure unit / (1 - Profit and contingences factor)
How is the pure premium calculated in the given problem?
Incurred losses + Loss adjustment expenses / Exposure units
What is the value of expenses per exposure unit in the given problem?
SR 13
What is the formula to calculate the Expenses per exposure unit?
Expenses per exposure unit = Expenses / Exposure units
What is the purpose of the profit and contingences factor in the rate per exposure unit calculation?
To account for uncertainty and risk in the calculation
What is the value of the rate per exposure unit in the given problem?
SR 56.45
What is the purpose of the Loss Ratio method in ratemaking?
To adjust an existing insurance rate to reflect changing conditions
What is included in the expenses provision in the Loss Ratio method?
Profit and contingencies
What is the result of adding the expected loss ratio and expenses provision in the Loss Ratio method?
Equal to 100 percent
What is the formula to calculate the Rate per exposure unit?
Rate per exposure unit = Pure premium + Expenses per exposure unit
What is the purpose of the expenses per exposure unit in the rate calculation?
To adjust the pure premium upward
What is the primary factor that rates or premiums for insurance are based on?
Past experience of losses
What is the purpose of loading the expected claim payments in actuarial calculations?
To accommodate underwriting, management, and claims handling expenses
What is the formula for calculating the pure premium?
Pure premium = incurred losses + L A E / Exposure units
In the pure premium method, what is the purpose of the earned car-years?
To serve as the exposure units
What is the primary role of an actuary in an insurance company?
To calculate the rates and reserves
What is the significance of the 5% profit and contingences in the pure premium method?
It represents the desired profit margin
Learn how to calculate insurance premiums with Dr. Ragab Abouhamad's step-by-step approach. This quiz covers the formula and calculation of expenses per exposure unit, pure premium, and more.
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