Staff-T1

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Staff-T1
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  • I wouldn't look at it from an opening and closing rate. I would look at it as more of "what curve should I use at each period". For this example, you would use the same curve at each period. That means that at time 1, from the same discount curve, y…
    in unwinding - setting closing rates Comment by Staff-T1 April 5
  • Sorry which exact battle card are you referring to? I am having trouble locating it
    in level of aggregation wordings Comment by Staff-T1 April 3
  • To make comparison easier between the LRC and LIC. If the discount rates are different, the long-tailed nature of the business amplifies the effect of a differing discount rate on the PV FCF
    in Q27 Comment by Staff-T1 April 3
  • I think yes, it would be row 999
    in Pretax Net income Comment by Staff-T1 April 3
  • Probably a rounding error when they calculated the payment pattern. They have already provided you the paid losses directly
    in Q25 Comment by Staff-T1 April 2
  • a) Yes this is true b) Not true as you mentioned above c) Will have positive FCF and no CSM d) Will have to book a LC so it will be non-zero
    in LRC at Initial Measurement = 0? Comment by Staff-T1 April 2
  • Your interpretation is not quite correct here. Your opening discount curve means that for the payment of 187500, the discount rate that will bring it to the PV is 4.2% compounded over 1,5 years. I do not know what you mean here "opening rate is 4.2…
    in unwinding - setting closing rates Comment by Staff-T1 April 2
  • It's just converting the dollar amount of risk adjustment to a % basis of the BEL. You are usually provided the RA % directly and skip the dollar derivation of the RA. This question is meant to provide you an example of how you actually arrive at th…
    in Sample 9 Comment by Staff-T1 April 2
  • Well yes it might be - But I don't think I have seen a policy like that in real life
    in 'Pre-set Limits on Timing of Payments' as a 'Terms-Set-in-Advance Risk Limiting Feature'? Comment by Staff-T1 March 30
  • I'll give an example: Imagine a reinsurance contract initially set for three years. If both parties can cancel it at the end of each year with a three-month notice, then at the start of the contract, the reinsurer is only firmly committed to providi…
    in Q24 Comment by Staff-T1 March 30
  • I think personally for me, the biggest challenge is proving that the PAA estimate is close enough to the GMA one. There's a lot of uncertainty and as you mentioned volatility, given a lack of historical data so it's hard to say pass a PAA test from …
    in Sample Q14 part iii. Comment by Staff-T1 March 29
  • That's cause your cost of capital is basically as it mentions the "cost" of holding capital to support the business. At every period, you hold the **total **capital to support that group, not the incremental capital which correspondingly means that …
    in sample Q4 Comment by Staff-T1 March 29
  • Mortgages are usually considered an asset (i.e. the insurer is supplying a mortgage to a third party) There would be no reason for an insurer to take a large mortgage (usually, unless purchasing a building) But in an exam, it would be clearly stated…
    in Invested Assets Comment by Staff-T1 March 27
  • 4) Direct UEP is just related to direct contracts whereas UEP relates to gross written premium (Which includes assumed reinsurance in addition to direct written premium) 6) Technically it is UEP = premiums received + premiums receivable - earned …
    in Question 17 Clarification Comment by Staff-T1 March 27
  • There is a interactive question in Mini Battlequiz 2 which you can practice on for this specifically
    in final cap av Qs Comment by Staff-T1 March 27
  • I do not believe you are given the definition of what exactly is in Capital B and C so you wouldn't be expected to calculate them on your own. The 40% and 7% are mentioned in section 2.2
    in capital composition limits - different set up Comment by Staff-T1 March 27
  • No, reinsurance would not be recognized before it is bound
    in Question 3 Comment by Staff-T1 March 27
  • In sample 29, they included it in the incurred claims and it flows through into the ISE and correspondingly the ISR
    in Sample Q29 c Comment by Staff-T1 March 27
  • 1) Yes 2) Yes 3) I's the latter, premiums that you are supposed to receive, but they are still with the policyholder 4) D UEP? Could you clarify what you mean by that please 5) Yes exactly. For GMM you are strictly looking at FUTURE cash flows. …
    in Question 17 Clarification Comment by Staff-T1 March 27
  • Which cell are you looking at? I do not see the $100 being discounted
    in duration excel B sh1 - LIC Comment by Staff-T1 March 26
  • These numbers would come from actually running the FCT. The solvency scenario usually occurs during the projection period, so sometime after 2022. It could be spread out over multiple years, for example an inflation or recession scenario. The solven…
    in Practice: 4 FCT Financial Condition problems Comment by Staff-T1 March 26
  • 1) Yes FCF + CSM = 0 at time 0. 2) Correct 3) The CSM is drawn down as service is provided (usually uniformly unless you have certain seasonal policies like cat reinsurance for example) I am unsure what you mean by difference will be larger as tim…
    in Question 3 Comment by Staff-T1 March 26
  • Typically you just need to approximate a very small change so 0.1% is fine; 0.01% is also okay. I think 0.01% (1 basis point) is actually the most common.
    in IR shock for calculation of effective duration Comment by Staff-T1 March 25
  • AA's MAE report is done as and when needed. Where are you seeing the statement "as requested by OSIF" It is requested by OSFI once a year and to my knowledge I don't think I know of anyone who has done an FCT more than once a year
    in Card #9 Comment by Staff-T1 March 25
  • Assumed written premium, ceded written premium, direct written premium
    in Assumed Premium From Intra-Pool Counted towards growth? Comment by Staff-T1 March 23
  • No, you cannot. The latest AY a claim from a policy issued in PY X can occur is in AY X +1. This is the first basic concept explained in exam 5. For a given PY say 2024, the first day a policy can be issued is Jan 1 2025 which means any loss should …
    in IFRS-DR_1 Problem Set (Half Year Shifts) Comment by Staff-T1 March 23
  • I wouldn't overthink it that way. Issue year is the same as policy year
    in Issue year Comment by Staff-T1 March 23
  • No your calculation is incorrect. You are double counting Cap B and Cap C. Why do you say that Cap B and C are not included in the Gross Capital Available in the Battlequiz question?
    in Capital composition limit Comment by Staff-T1 March 23
  • Initial recognition and inception are the same thing. In an exam question if calculating FCF they will let you know how much premiums are outstanding. You will know if the premium has already been received
    in Q22 Comment by Staff-T1 March 20
  • You can check number 13 in the sample IFRS17 questions. I did the calculations in Excel for the unwinding of discount according to the expectations hypothesis
    in Unwinding of discount Comment by Staff-T1 March 20