C - CIA Valuation

Question 1

CIA VALUATION

Discuss considerations when using another person’s work

Answer 1

AA may use and take responsibility for another person’s work if confident that it is justified

However, if not confident, AA would not take responsibility for the other person’s work

AA may still use another person’s work, but not take responsibility. The AA would examine the work for evident shortcomings and would either report the results of examination or avoid use of the work

Question 2

CIA VALUATION

Following Fort McMurray Wildfires, aspects to consider in order to determine the best estimate for this CAT loss

Answer 2

1) contamination of soil
2) rental vehicles
3) smoke damage
4) large % of insured may choose ACV rather the rebuilding
5) extra cost due to remote location of the loss

Question 3

CIA VALUATION

Following Fort McMurray Wildfires, elements on which the AA have to consider the impact on:

Answer 3

AY2016 will have a longer payout pattern for affected LoBs

reinsurance margins to be applied to ceded portion

reinsurance costs associated with Unearned Premium

ULAE may need to be tempered because it is a ratio of unpaid loss