graham
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It's funny you should mention that because I had the same issue with the earthquake reading. You're right that on page 10 of the earthquake reading, under the subheading "Capital and Surplus", they refer you back to the MCT reading for more informat…
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Yes, thanks. It has been crossed out on the most recent version of the Annual Return Supplement on page 10.60. I've updated the wiki to mark that and a couple of other relevant related problems as outdated.
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Yes, that's an excellent point. I have corrected that section in wiki. I've also added that information to the introductory section in the wiki article and have inserted some extra text to a few BattleCards as well. This relationship between liquidi…
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First of all, just to be clear, my reading of the text is that the percentiles refer to the severity distribution. There doesn't seem to be any mathematical discussion of appropriate frequency levels. Anyway, I think the intent is that going-conc…
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I'm glad you asked because I forgot to update that diagram in the wiki. Thx! I couldn't find an explanation for "Maxiumum +2" but I assume it means the BCAR assessment cannot improve by more than 2 levels (out of the 6 available levels) at the st…
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Appendix B in the source text has a lot of examples but they all relate to life insurance. The first example of an amount that could be returned to customers is the CSV (Cash Surrender Value) of a whole life insurance policy. This is the amount t…
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Yup. Thx!
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The definitions you listed are technically correct. I paraphrased them in the wiki to be more consistent with the examples in Appendix B. It's true that the FCT reading seems to draw a distinction between management actions and corrective management…
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There are 2 ways the answer to your question can be explained. The first way is using the decision tree, but that might not get at the heart of your question. The second way is more intuitive. * Decision Tree explanation: If you follow the "EWD…
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Yes, I believe you are correct. I went back to the MCT source reading and it says the NSP (Net Spot Position) is the sum of: * the sum of the net open long positions * the absolute value of the sum of the net open short positions A simpler…
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The Exam 6C committee probably didn't realize the reading had been updated again, but the reference given in the syllabus is the one you should use. I haven't checked it, but my guess is that there would only be minor differences. And thanks for …
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I think I see what you're trying to state but you have to be a little bit careful. The quantities on the right don't represent APVs. The quantities on the right represent the gross and net undiscounted amounts you would start with as a first step in…
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Sorry, it was a typo. Thanks for letting me know.
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Actually, that came up in my answer to your previous post about a different earthquake problem but I'll elaborate here: There is another reading on earthquakes: OSFI.Eqk. That reading discusses the 4 types of financial resources that can be used …
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When they state that PML500 is being phased in, it means you can't use PML500 directly. You have to calculate PML420 and then take a weighted average of PML420 and PML500. The weight given to PML500 increases from the year 2014 to the year 2022, at …
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Points 1 and 2 are good rules of thumb: * Ceding less desirable risks to the pool is a hedge. If you cede risks that are worse than the pool average, then everyone else ends up subsidizing you. If you (inadvertently) cede risks that are better …
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Hi... It looks like you calculated 10,752 in C84 but then used 10,750 in cells B86, B98, B88. The values in C86, C87, C88 do appear correct however so there is an inconsistency in your spreadsheet. There is a solution in the wiki here: * htt…
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It's an error in the examiner's report. Here's what it should be: * min(RR, APV) = 84,325 They reversed the 4 and the 3 and that's how they got 83,425. If you do the calculation as given in the examiner's report, you get 39.99 (which is wro…
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I see what you mean. If Target CapReq corresponds to a CTE of 99% then you would expect the calculation of Target CapReq to follow some kind of probabilistic reasoning using distributions related to the various risks. But the rest of the reading pre…
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Update: * As noted by the poster below, my original answer referred to Fall exam rather than the Spring exam. The calculation in the 2015.Spring Q22 is no longer relevant as the calculation of Investment Income from Insurance Operations (page 1…
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Although you usually don't have a choice because of how the information is given, acccording to the CCIR Annual Statement Instructions, there is no single answer as to whether to use APV or non-APV here. You're supposed to use the value from Page 20…
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You are right that the question wasn't clear. Your interpretation is reasonable and I just noticed the next time an excess/deficiency question was asked, which was 2015.Spring Q21, they explicitly stated accident year. All exams subsequent to that a…
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Sorry for the delay in responding. This post got stuck in my drafts and I just noticed. It's shown in the Battle Table as CIA.IFRS17-DR. I'm working on this now and the wiki article will be available by the end of January.
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Both readings are about discount rates but the new reading relates to the new IFRS 17 accounting standards. Some material from the old discounting reading will carry over and some of it won't. I will complete the wiki articles for the new reading…
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For this bullet point: I think they are just dotting their i's and the crossing their t's here. I looked through the annual statement instructions but I couldn't find any reference to how this assumption makes any difference to the calculatio…
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Thx! I made a note of it in the BattleTable section of the wiki article.
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The presentation in the CIA's source text for premium liabilities is a little hard to follow, but if you look in the Excel spreadsheets that come with that reading, the premium liabilities are defined as: * premium liabilities = APV + FutRe + m…
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Just to make sure anyone else reading this knows what we're talking about, here is the relevant paragraph from the source text: (It's also mentioned in the web-based practice problems for MCT.) So the answer to your question is you have to be…
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It should probably be less than or equal, but I couldn't find any specific reference in FSCO's PPA guidelines. The answer in the examiner's report says "lesser" but in practice there would be no difference between "less than" and "less than or equal…
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Actually, any type of duration is a measure of the sensitivity of cash flows to the interest rate. The source text states: * Duration is a concept or tool that is used to measure both the average maturity of a series of fixed future cash flows,…