bennybees1
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do we need to know the risk factors for operational risk? I just took another look at the syllabus and it says we're not responsible for risk factors relating to insurance, market or credit risk, but they never mentioned operational risk. Does this …
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a follow-up question: does prescribed regulatory basis mean following the guidelines from the CIA? If yes, can we say that a challenge would be that FCT follows the CIA's guidelines whereas OSFI follows OSFI guidelines?
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Isn't it also required when auto rates change?
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Would a difference be that BCAR applies qualitative adjustments while FCT does not?
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Yeah, does this mean all risks attaching contracts do not meet the coverage period <= 1 year requirement?
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This seems like some sort of risk factor and the syllabus says we don't need to know the risk factors for the exam - could you provide more insight into this?
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I'm not sure but I think #2 are just quantitative methods listed to measure/calculate what's listed in #1
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Is it safe to say we can disregard this sample question as groupings is no longer on the syllabus?
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I don't quite understand - if LIC/AIC should be the same under PAA and GMA, shouldn't the figures in (72) and (74) be the same and shouldn't we only be using one of them?
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@AndrewL It's the first page in the excel exhibits for the LRC reading. But note that the 'master formula' does not contain the fact that you would deduct any DAC that are expected from cancellations
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In the CAS SampleQuestion #17, I noticed future acquisition costs were not discounted. Do we always assume that future acquisition costs will be realized at contract inception (in this case, it would be Dec 31, 2023) unless told to assume otherwise?
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Another follow-up question: LRC excl. LC = Premium Rec'd - Insurance Revenue - Gross DAC. Why is it not Net DAC of cancellations?
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Alright, thank you for the thorough explanation!
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Okay, so are you saying we should essentially ignore the Runoff paper and calculate excess (deficiency) as follows (?): Excess (deficiency) = undiscounted liabilities at prior year end - net amount paid during year - undiscounted liabilities. at…
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Ah I forgot that it's the opposite sign for reinsurance held. Thank you!
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Ah okay that makes sense, thank you!
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Ah okay, so this would mean the LRECC would increase the CSM on the ARC, since it represents an amount expected to be recovered?
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Can you have instances where you expect significant variability in the cash flows but this may not necessarily translate to a material difference between the GMA and PAA estimates? I'm guessing no but just want to confirm. After reading the text,…
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In the text, it says that under GMA, LRECC adjusts the CSM of the reinsurance contract held. But I'm confused as CSM is part of LRC and LRECC is booked as part of the ARC, which is separate from the LRC. Could you help clarify? Also, under both i…
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is the profit/loss statement the statement of financial performance?
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Ok thank you, so the formula for PAA LRC we should always be using is UEP - DAC?
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I'm still confused about whether there's 1 or 2 CATs tested... in the wiki, I believe there was mention to 2 catastrophes. But when reading the BCAR.Cat reading, the stressed BCAR score measures the balance sheet strength after a CAT event, but does…
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Is LRC = premium received - insurance acq. CF's the same as UEP - DAC? In other words, does premium rec'd equal UEP and does insurance acq. CF's equal DAC?
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Thanks for your response! I still don't understand 1). I thought the graph was representing the losses assumed by household (i.e. the losses not covered by insurance). Is it higher for insureds than non-insureds solely due to the amount of deductibl…
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What does "when bound" mean in the above context? Is it just another way of saying you need to reflect the group as onerous in the financial statements at the moment you realize it is onerous?
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Aren't the fulfillment cash flows are the discounted future cash flows plus RA?