Practice: 2 Simplified WC Loss Ratio Indications

jj96gotthisjj96gotthis
edited April 2021 in WernerD.WC

Hi Graham,

Shouldn't the (1-med% change) and (1-other %change) be (1+med% change) and (1+other %change) instead?

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For the first problem, I get a different answer for the two numbers circled in blue:

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Thank you!

Comments

  • GrahamGraham

    Yup, there was a typo in the formula. I've fixed it. Thx!

  • jj96gotthisjj96gotthis

    Hi Graham,

    For the "combined effect of projected trend", shouldn't the trend period be 2.5 instead of the trend factor of 1.0252?

    image.png

    Also, I believe this should be (1+ PAWC)^(trend period) which is equal to the trend factor of 1.0252.

    image.png

    Please correct me if I'm wrong. Thank you!

  • GrahamGraham

    You're correct. Thanks for going through it so carefully. I've made the corrections.

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