(Papers) ACET Paper May 2010 "SA1 – Health and Care
a) You are a pricing actuary of an Indian Insurance company
and requested to forecast the burning costs for the short term reimbursement
product portfolio for the current year using the current and last 3 years
experience. Describe the important aspects you need to consider in your
b) What may have been the purpose for this estimation?
c) The portfolio in question also includes products with high
excess. Which aspect now becomes more important in your estimation?
“Cross Health” is a start-up stand-alone health
insurance company in India and plans to launch a new product where the company
has not collected experience so far.
a) Please describe the six most common reasons for
b) Please describe briefly how “start up” and “experience”
may affect the decision on reinsurance protection.
c) Please describe how the level of reinsurance can influence
product design and pricing of Cross Health. Please describe concrete product
Q3) You are a pricing actuary and participate in a product
development project related to the development of an Indian inpatient
a) During one of the project meetings you are requested to
provide your quick assessment of how much cheaper the risk premiums of a Rs 4
lac family floater (sum insured floating across the whole family) for a couple
would be as compared to the existing single 4 lac sum insured product. You know
that the average claim size is about Rs 30000 and the annual claims frequency is
about 8%. What would be your answer? (6)
b) During another meeting you are requested to assess the
impact on price in case the company guarantees the premium rates of its
reimbursement inpatient product for longer than 1 year. What would be your
thoughts and advice to the project team?
a) Please describe briefly the term IBNR.
b) An Indian Insurer with a large health portfolio has
recently changed his TPA and is now observing a considerably improved 12 month
loss ratio. What could possibly be the reason for this improvement?
c) Another Insurer with large group health portfolio has
removed the cashless facility from his product provided by an TPA and sees the
loss ratio improve substantially? (1)
a) Please describe the reputational risk a health insurer is
b) How does the chosen underwriting approach of an insurance
company impact the reputational risk of the company?
c) Please describe all types of risks related to counter
parties and governmental bodies to which a health insurer may be exposed. Which
of these risks is especially high for health insurers?
d) Which other risk is very important to be considered and
highly specific for health insurance? Please provide examples for such risks.