Draw the diagram for parallelogram method on-levelling, this first step may save you from losing on all the steps!
Also, re-check your on-levelling at the end of the paper... Think of it this way, if you have set up the formulae properly, then changing the on-levelling after finishing the paper will only fix your entire solution! So, don't worry about getting it wrong in the first go. Just draw the diagram and be confident
Do go through D_Workers Compensation as it contains some domain specific details that's not available in the main study manual.
It's easy to on-level written premium, if no law changes. If you talk about going fast
You can trend FE ratio by average accident date without much loss of accuracy to save time
And also, just because more granular data is given in the question, don't feel obligated to use it, unless its mentioned in the question.
For example, if quarterly not-leveled average premiums are given, then you have to take another step to on-level them and calculate the premium trends. Instead, if you have already calculated on-leveled premium and have exposure information then feel free to use it! Nothing wrong
When copying formulae, especially when using hardcoded values like trend periods, ensure that you update and check the hardcoded values wherever you changed them. For example, you left out the trend period value as 3 after copying the formula to the next calendar year.
Remember: Credit is "good for insured" (discount)
There is a difference between:
What should happen if… \(\to\) A recommendation is being asked for, give a solution
What would happen if… \(\to\) They are asking about consequences.
If a question looks unfamiliar (theory ones), come back to it at the end:
E.g. say, you are given the question
You are a pricing actuary working on pricing relativities for a number of variables for a personal auto insurer.
For the scenario listed below, state any issues in the scenario that could distort an analysis, and justify a pricing approach that will accurately price the desired class(es) of business. If relevant, state any special requirements of what data should be used for the analysis.
So, for this, you identify the purpose, action items
You are a pricing actuary working on pricing relativities for a number of variables for a personal auto insurer.
For the scenario listed below, state any issues in the scenario that could distort an analysis, and justify a pricing approach that will accurately price the desired class(es) of business. If relevant, state any special requirements of what data should be used for the analysis.
Hence, we know that the context is "pricing relativities" and we have to