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A Note On The Parallelogram Method For Computing The On-Level Premium, David P.M. Scollnik, Wai Man Sara Lau
A Note On The Parallelogram Method For Computing The On-Level Premium, David P.M. Scollnik, Wai Man Sara Lau
Journal of Actuarial Practice (1993-2006)
This paper discusses the differences appearing in the descriptions of the parallelogram method for the determination of earned premium at current rate levels given by McClenahan (1996) and Brown and Gottlieb (2001). It observes that the former is consistent with the method of extending exposures while the latter is not. An illustration is provided. This paper also discusses two other approaches to the determination of the earned premium.