by Guest » Sat May 05, 2012 09:28 am
Exercise:
1. A premium of 100 is written on June 30, 2010
- What is the amount of the UPR on Dec. 31,2010?
2. Premium commissions of 30% are paid to broker
- What is the amount of comissions paid in 2010?
- What is the amount of Deferred acquisition costs?
3. Claims cost of 2010 amounts to 40 (including claim handling costs). Administration costs amount to 10.
- Is a URR necessary?
If yes, how much does it amout to?
Can someone help me in this exercise... I am a beginner in insurance calulation...
Thank you very very much in advance...
I think the first 2 question I did right but I dont know the last one!!!
1. A premium of 100 is written on June 30, 2010
- What is the amount of the UPR on Dec. 31,2010?
2. Premium commissions of 30% are paid to broker
- What is the amount of comissions paid in 2010?
- What is the amount of Deferred acquisition costs?
3. Claims cost of 2010 amounts to 40 (including claim handling costs). Administration costs amount to 10.
- Is a URR necessary?
If yes, how much does it amout to?
Can someone help me in this exercise... I am a beginner in insurance calulation...
Thank you very very much in advance...
I think the first 2 question I did right but I dont know the last one!!!
Posted: Sat May 05, 2012 03:21 pm Post Subject:
What is UPR and URR?
If UPR has something to do with unearned premiums, then the unearned premium is 50%.
If commissions are 30%, the commission in 2010 is 50% of 30% of $100, or $15, assuming commissions ar paid "as earned". If commissions are paid on an "advanced" basis, the commission paid in 2010 could be anywhere from $22.50 (75% of annual) to $30 (100% of annual).
No one can tell you what the Deferred Acquisition Cost is, because it can vary from one insurance company to another. It has also been prohibited in some states.
Question 3 makes no sense. Does it relate to the single policy with the $100 premium?
Have you asked any of the other students in your class for help?
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