ALRIGHT. Can someone verify my logic? I'm trying to spell everything out as clearly and exactly as I can in my mind.
Also, is there any disadvantage to PY data as a result of PY premiums being less responsive or mature relative to the other methods? I've only explained (hopefully correctly) the disadvantage of PY data as a result of PY losses.
My answer to the question: what is the disadvantage to PY data relative to CY and CY/AY data?
PY data is less responsive
b/c => it takes longer to become available
b/c => losses takes longer to be reported
b/c => assuming annual policies, it takes up to 2 years from the beginning of the policy year for all PY losses to occur
b/c => it takes up to 2 years from the beginning of the policy year for all PY policies to expire
b/c => it takes up to 1 year from the beginning of the policy year for all PY policies to be written
PY data is less mature
b/c => losses takes longer to develop
b/c => losses take longer to be reported
b/c => see logic in the section above
Also, is there any disadvantage to PY data as a result of PY premiums being less responsive or mature relative to the other methods? I've only explained (hopefully correctly) the disadvantage of PY data as a result of PY losses.
My answer to the question: what is the disadvantage to PY data relative to CY and CY/AY data?
PY data is less responsive
b/c => it takes longer to become available
b/c => losses takes longer to be reported
b/c => assuming annual policies, it takes up to 2 years from the beginning of the policy year for all PY losses to occur
b/c => it takes up to 2 years from the beginning of the policy year for all PY policies to expire
b/c => it takes up to 1 year from the beginning of the policy year for all PY policies to be written
PY data is less mature
b/c => losses takes longer to develop
b/c => losses take longer to be reported
b/c => see logic in the section above
Policy Year Data Disadvantage
