STUDENT NAME

Homework 4 (6 points)

Property & Casualty Insurance

1. Calculate the expected quarterly underwriting profit and combined ratio for the following policy using Statutory Acctg and GAAP Acctg.
Annual policy effective April 1, 2017
Written Premium = $40,000
Expected LR = 75%
Commision expense ratio = 15% (all paid in April 2017)
Other expense ratio = 15%

Income Statement - Statutory Basis Income Statement - GAAP Basis

Q2 2017 Q3 2017 Q4 2017 Q1 2018 Full Yr Q2 2017 Q3 2017 Q4 2017 Q1 2018 Full Yr
Earned Premium - -

Expected Losses - -

Commissions - -
Other expenses - -
Total Expenses - - - - - - - - - -

Underwriting Profit/(Loss) - - - - - - - - - -

Loss Ratio #DIV/0! #DIV/0! #DIV/0! #DIV/0! #DIV/0! #DIV/0! #DIV/0! #DIV/0! #DIV/0! #DIV/0!
Expense Ratio #DIV/0! #DIV/0! #DIV/0! #DIV/0! #DIV/0! #DIV/0! #DIV/0! #DIV/0! #DIV/0! #DIV/0!
Combined Ratio #DIV/0! #DIV/0! #DIV/0! #DIV/0! #DIV/0! #DIV/0! #DIV/0! #DIV/0! #DIV/0! #DIV/0!

2. What is the Unearned Premium at the end of each quarter? (same for STAT and GAAP)
6/30/17 9/30/17 12/31/17 3/31/18
Unearned Premium

3. Assuming no losses get paid during the policy period, what are the Loss reserves at the end of each quarter? (same for STAT and GAAP)
6/30/17 9/30/17 12/31/17 3/31/18
Loss Reserve

4. Assuming insurance company pays losses of $2000 on Sept 15, 2017 & $5000 on Jan 10, 2018, what are the Loss reserves at the end of each quarter? (same for STAT and GAAP)
6/30/17 9/30/17 12/31/17 3/31/18
Loss Reserve

747827639.xlsx