B.15.Fisher

Aggregate policy
- limit to the amt that an insd will need to pay in pol period
- can use table M to price ded w aggregated ≡ retro rated w per loss limit
Similarities btwn ded + agg & retro
- infinite ded + agg ≡ retro w max but no per loss limit
- retro w per loss lim but no max ≡ ded w no agg
Pricing a ded + agg policy
- price XS & agg loss simultaneously ≡ Table L
- charge for 2 cpts ≡ ins charge + ELF
Pricing ded + agg w Table M_D
- closer to M than L → no add'l charge for limited losses
- exp limit losses are used instead of ground up loss
- need separate table M_D for each ded (impacts size of loss dist)
Pricing ded + agg w Table M
- use lim losses to get ELG
- calc r = agg / lim
- LER = ELF / LR → get LGAF & ELG
- use Table M
Choice of primary loss
- only have a small impact if r high or ded low
- otherwise ins charge will be inadequate / excessive
- $ error greater for large pol low r
- % error greater for large pol high r

Author

Exam8

166073

Card Set

B.15.Fisher

Description

Pricing Aggregates on Deductible Policies

Updated

2012-08-15T01:16:49Z

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