Actuarial Outpost ASM Exam C Manual Exercise 11.15 [4-F01:36]
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#1
05-18-2018, 03:09 PM
 jenniferlsq SOA Join Date: May 2018 College: Bucknell University Posts: 1
ASM Exam C Manual Exercise 11.15 [4-F01:36]

For this question, can someone help me understand how is the average number of losses per year = 2,000,000/23,759?

This does not make sense to me because 2,000,000 is the aggregate loss, but 23,759 is average payment with policy limit of 1,000,000 - so how is expected number of loss = expected aggregate loss / expected payment with policy limit?

I understand the formula is E[S]=E[N]*E[X] but my understanding is that this E[min(Loss;1,000,000)] is not E[X].

Also, anyone found Abe (the one who wrote the book and made the coaching actuaries videos) a bit passive aggressive when answering questions? I feel dis-encouraged asking questions on CA because of that..
#2
05-22-2018, 09:31 PM
 Academic Actuary Member Join Date: Sep 2009 Posts: 8,339

It would help if you could post the problem as some people do not have the manual.
#3
05-22-2018, 09:59 PM
 Abraham Weishaus Member SOA AAA Join Date: Oct 2001 Posts: 7,197

Aggregate losses are the total losses after individual deductibles and limits, so they already take the 1000000 per-claim limit into account. Aggregate losses are only modified by aggregate deductibles and aggregate limits.

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