2014 spring 8
I'm confused with what is this question exactly asking. It says it wants "an indicated relativity change for policyholders in territory 3", so I take it that this refers to (indicated relativity for terr. 3)/(current relativity for terr. 3)-1? The sample answer 1 ends with a calculation of this value. However, where should the "for a revenue neutral overall change" part be accounted for in the calculation? Does it simply not matter since the relativity change for terr 3. is asked for, not the rate change for terr 3.? Also, how is the statement in the question "assume no adjustments are made to the relativities for expense considerations" used?
Comments
Take a look at this forum discussion to see if it helps answer your question:
Footnotes 2 & 3 about that exam problem from the Battle Table might also shed some light:
Here's a direct link to the Battle Table:
Let me know if that doesn't answer your question.