Alphabet City Practice Problems

jaylow96jaylow96
in CCIR.ARinstr

Hi,

In the 8 practice problems for Alphabet City, I noticed that the UEP recoverable from reinsurers in the prior year is calculated by taking the reinsurance quota share retention % x the gross UEP under the liabilities and equity.

I thought that the retention % indicates the % retained by the company, so the UEP ceded should be (1-retention%) x gross UEP?

Thank you for looking into the question.

Comments

  • grahamgraham
    edited January 2020

    Very observant - thanks for finding that! It shouldn't effect how you solve the problem but I fixed the formula and generated 8 new random problems. If you still want to see the previous version of these problems, let me know. (P.S. I gave you a shout-out in the wiki.)

    (For anyone else reading this, the issue was that the given information was not internally consistent. The solution itself was still valid though.)

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